AsiaDry Cargo

Western Australia-China spot rates help capesize market reach all-time low again

Abandon all hope: spot rates for capesize bulk carriers have come crashing down again to record-low levels – even worse than seen during the Chinese New Year holiday this year.

The Baltic Capesize Index (BCI) was today assessed at the historic low of 177 points, a five-point decrease on Thursday’s level. The weighted timecharter average for five of the BCI’s major benchmark routes was today assessed at $2,396 per day, a new record low.

But in spite of the capesize market capsizing, firming freight rates for panamaxes, supramaxes and handysize bulk carriers helped the Baltic Dry Index move up two points today to reach 327.

While most Baltic benchmark routes for capesizes have shown a gradual but steady decline in recent weeks, the Western Australia to China route has suffered a more dramatic rout.

Baltic spot rates for capes carrying 160,000/170,000 tons of iron ore on the Western Australia to Qingdao, China route (C5) were today assessed at $2.864/ton, just a touch above the record-low level of $2.843/ton seen on February 8. Rates on the route managed to recover to $3.082/ton on February 16, after China returned from its national holiday, but have posted consistent declines each consecutive trading day since then.

But reported fixtures show even more shocking rates. Rio Tinto is today reported to have fixed an unnamed Chinese-operated cape to carry 170,000 tons of iron ore from West Australia to China for just $2.85/ton, loading from March 10-14.

On Thursday, brokers reported that Everest had fixed Formosa Plastics’ super-cape  FPMC B Image (206,700 dwt, built 2012) to carry a 190,000-ton ore cargo from Port Hedland, Western Australia to Qingdao for $2.75/ton, loading “early March”.

Holly Birkett

Holly is Splash's Online Editor and correspondent for the UK and Mediterranean. She has been a maritime journalist since 2010, and has written for and edited several trade publications. She is currently studying for membership of the Institute of Chartered Shipbrokers. In 2013, Holly won the Seahorse Club's Social Media Journalist of the Year award. She is currently based in London.
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