Dry bulk iron ore freight rates decline w-o-w as Chinese import prices drop

• Limited inquiries amid weak market sentiments
  
  
• Bunker prices dragging freight rates lower
  
  

Dry bulk iron ore freight rates trended down this week. Some movements of ships were recorded but due to a drop in bunker prices and weak market sentiment, freight rates declined in the global market. Inquiries were seen fixed for large vessels amid healthy tonnage supply in the Atlantic and Pacific regions.

A shipbroker said, "Falling bunker prices and limited cargoes in the market amid weak sentiments have seen a decline in inquiries weighing on freight rates."

Spot prices of iron ore fines (Fe 62%) are currently hovering at $110/tonnes (t) CFR China on 10 July, 2024. Prices have fallen from $114/t CFR China earlier last week. However, import margins and losses were reported to be unstable, leading some end-users to shift their focus to the domestic market instead.

Asia-Pacific Supramax dry bulk (50,000-55,000 t) freight rates for an iron ore vessel from the east coast of India to China fell by $0.71/t this week to $13.5/t on 10 July.

Route-wise freight specifications:

• India-China: Freight rates from the Indian Ocean to China have been lowered this week amid absence of inquiries. However, a few inquiries are under negotiation, as per sources.
  
  
• Australia-China: Freight rates for Capesize vessel carrying iron ore from Western Australia to China were assessed at $10.20/t on 10 July, a decrease of 1.45/t w-o-w. The supply of tonnage in the Pacific remained healthy, with shipowners preferring to stay in the region due to declining rates in the Atlantic. Good weather and low waiting times at Chinese ports further bolstered supply in the Pacific.
  
  
• Brazil-China: Freight rates for Capesize ships moving iron ore from Brazil to China declined this week. For instance, rates for a shipment from Tubarao to Qingdao were assessed at $27.10/t on 10 July, down by $3/t w-o-w. Fixture levels out of Brazil were reported to be lower, which contributed to the pressure on rates in the Atlantic region.
  
  
• South Africa-China: Freight rates for Capesize vessels from Saldanha Bay to Qingdao were at $20.39/t, declining by $3.88/t w-o-w. Movement of vessels in this route has been recorded for mid-July shipments which has boosted freight rates.