Despite a weak performance in December, dry bulk rate expectations for the New Year have held firm, according to the Singapore Exchange (SGX).
The Baltic Dry Index (BDI) slipped by 20% during the last month of 2016, driven by a steep decline in capesize and panamax rates.
However, the SGX said in its monthly report that better-than-expected demand in 2016 and a relatively slim orderbook have created cautious optimism that the industry may have seen a cyclical bottom.
This is the main reason why moderately stronger rates are anticipated in 2017, the SGX added.
Capesize and panamax rates declined by 39% and 42% respectively in December, following a strong November which saw the BDI remain above 1,000 since late summer 2015.
But the dry bulk index closed the year below the 1,000 mark at 961.
SGX noted that trade uncertainties could contribute to keeping the orderbook restrained in 2017, in favour of higher rates.
It formally completed the takeover of the Baltic Exchange two months ago in a $107m deal.
