Dry bulk iron ore freight rates head north following global price rally

• Fresh fixtures for mid-October shipment support freights
  
  
• Shipowners active in booking vessels ahead of weeklong holidays
  
  
• Freight rates from the Indian Ocean to China rise by $0.4/t w-o-w
  
  

Dry bulk freight rates increased this week, influenced by the rise in global iron ore prices. Notably, in China, Golden Week holiday is going on from 1-7 October. Shipowners are highly active in booking vessels during the holiday period, as favourable weather conditions and increasing cargo demand have created a positive sentiment in the global market.

China's spot price of iron ore fines (Fe 62%) was assessed at $108/t CFR on 1 October, increasing by $19/t w-o-w amid restocking activity and positive macroeconomic developments in the country, particularly stimulus measures aimed at stabilising the property market. Three major cities announced easing restrictions on home purchases, and the People's Bank of China pushed for lower mortgage rates, which boosted market sentiment.

Meanwhile, according to BigMint's assessment, Asia-Pacific Supramax dry bulk freight rates (50,000-55,000 tonnes) for iron ore shipments from the east coast of India to China increased by $0.4/tonne (t) w-o-w to $13/t as of 1 October.

Route-wise freight market updates:

• India-China: Freight rates from the Indian Ocean to China have been recorded at $13/t, up by $0.4/t w-o-w. According to shipowners, market participants are actively booking vessels due to improved weather conditions and strong demand. Fresh fixtures are currently under negotiation for mid-October dates, owing to the ongoing Golden Week holiday in China from 1-7 October.
  
  
• Australia-China: Freights for Capesize vessels carrying iron ore from Western Australia to China were assessed at $11.67/t on 1 October, stable w-o-w. According to sources, major Australian miner Rio Tinto has booked a vessel from Dampier Port to Qingdao Port at freight $11.2/t. The shipment period is 11-13 October.
  
  
• Brazil-China: Freights for Capesize vessels carrying iron ore from Brazil to China remained largely stable this week. Rates for shipments from Tubarao Port to Qingdao Port were assessed at $28/t on 25 September, inching up by $0.1/t w-o-w. As per sources, few vessels have been booked from Tubarao Port to Qingdao Port at a freight of $27.65-28/t. Notably, the shipment is slated for 15-30 November.
  
  

• South Africa-China: Capesize freights from Saldanha Bay Port to Qingdao Port inched up by $0.5/t to $20.9/t w-o-w. Trading activities and fresh inquiries were absent for the route. These factors kept freights at similar level this week.