Dry bulk freight rates exhibit mixed sentiments, hike likely post-holidays

Dry bulk freight rates displayed volatility in the global market, owing to the subdued trade activities due to ongoing Christmas, New year holidays and tensions in the Red Sea.

Asia-Pacific Supramax dry bulk (cargo capacity 50,000-55,000 t) freight rates remained rangebound this week as per SteelMint's assessment. The freight rate of an iron ore-loaded Supramax vessel from the east coast of India to China was heard at around $14-15/tonne (t), slightly up as compared to last week.

A shipbroker stated, "enquiries are boosted for January laycan. Owing to the current scenario in the Middle-east, the shipment has fallen and few fixtures have been cancelled due to ongoing war scenario. Freight is expected to be on higher levels post market resumption amidst holidays".

"Vessel movement is under control as shipment are aligned from Indian ocean. Freights are likely to hike in upcoming days," a ship broker informed.

Capesize freight rates fall w-o-w - Capesize dry bulk (cargo capacity 160,000-170,000 t) freight rates dropped this week. The Capes market witnessed dull activity as unavaliability of participants amid ongoing holidays.

A ship charterer informed, "Freights are under pressure as bunker rates are down. The iron ore demand is moderate on holidays, with lacklustre activity and diminished demand. Old contracts keep things ticking, but with most players on vacation, major movements are on hold until January returns. Expect a brief outbreak in the first two weeks, followed by a quiet leading up to the Chinese New Year. Unless a surprise event disrupts the scene, this steady trend should stick around".

Outlook: Some shipping companies are idle due to limited fixtures during holidays. In the near term, freights are likely to rise, as enquiries are fixed for January. It is expected that ship owners are likely to prepare for the upcoming month owing to less demand currently and situation in the Red Sea are unexpected.