Dry bulk iron ore freights downtrend w-o-w; Australia goes contrarian

• Speculation on China policy shifts add to uncertainty
  
  
• Declining bunker prices & cargoes hit India-China route
  
  

Dry bulk iron ore freight rates down-trended this week amid lack of demand from Chinese buyers. amid its prolonged property slump, rising debt risks, and weak domestic demand. However, market sentiment remains buoyed by expectations of supportive fiscal and monetary policies ahead of key economic meetings in December. Speculation about potential policy shifts added to market uncertainty, while increased sourcing from nearby countries by land also influenced trade dynamics.

According to BigMint's assessment, Asia-Pacific Supramax dry bulk freights (50,000-55,000 tonnes) for iron ore shipments from the east coast of India to China declined by $0.3/tonne (t) w-o-w to $12.2/t on 27 November.

Factors influencing freights this week

• Baltic index decreases w-o-w: The Baltic Dry Index (BDI) was recorded at 1,537 points on 26 November, down by 248 points w-o-w. Notably, the Baltic Capesize Index stood at 2,626 points, falling by 603 points w-o-w. Meanwhile, the Baltic Supramax Index declined to 984 points, down 35 points w-o-w.
  
  
• China's iron ore spot prices largely stable w-o-w: China's spot prices of iron ore fines (Fe62%) were assessed at $103/t CFR on 26 November, up by $1/t w-o-w, supported by improved downstream market fundamentals. However, trading activity has slowed as market direction remains unclear, with some end-users seeking cost-effective low-grade cargoes and mills preparing for a winter sinter cut. As per reports, ongoing destocking efforts bolstered downstream steel demand and can sustain higher pig iron production levels.
  
  

Route specifications:

• India-China: Freights from the Indian Ocean to China were recorded at $12.2/t, down by $0.3/t w-o-w. Demand from Chinese buyers was weak but a few fixtures are still under negotiation, and these might get concluded next week. These expectations kept freights on the lower side. According to shipowners, "The continued decline in bunker prices and less cargoes at portside have pressured rates on this route."
  
  
• Australia-China: Freights for Capesize vessels carrying iron ore from Western Australia to China were assessed at $10.5/t on 27 November, up by $0.65/t w-o-w. According to sources, major Australian miners Rio Tinto, BHP and FMG were seen actively booking cape vessels from a Western Australia port to Qingdao Port at around $10.30-10.75/t. The shipment is scheduled for mid-December.
  
  

• Brazil-China: Freights for Capesize vessels carrying iron ore from Brazil to China inched down this week. Rates from Tubarao to Qingdao Port were assessed at $23/t on 27 November, decreasing by $1.75/t w-o-w. BigMint observed lack of inquiries and scarcity of cargo volumes on this route which pressured down freights.
  
  
• South Africa-China: Capesize freights from Saldanha Bay Port to Qingdao Port dropped by $1.2/t w-o-w to $17.5/t. Decrease in cargo volumes resulted in an oversupply of ships relative to demand.