Dry bulk iron ore freights fall w-o-w, except Australia

• Iron ore spot prices decline by $11/t w-o-w
  
  
• Iron ore inventories at Chinese ports rises over to 145 mnt
  
  

Dry bulk iron ore freight rates experienced a slight decrease this week on major routes, as demand remained low and trade activities are limited in global markets. Furthermore, buyers have secured vessels at reduced rates for shipments in June. Also, further increases in iron ore inventories at China's major ports was seen. Port stocks continued to remain on the higher side at 145.5 mnt (million tonnes) on 30 May 2024, according to SteelHome data.

Spot prices of iron ore fines (Fe 62%) fell sharply by $11/tonne (t) w-o-w to $106.80/t CFR China on 5 June* amid weak fundamentals and a slow market. The Chinese government outlined regulations for steel production capacity and output under the FY'25 Energy Saving and Carbon Reduction Action Plan, announced on 29 May 2024. Moreover, the decrease in steel prices due to macro-economic trends has resulted in a general decline in the demand for downstream steel products. Mills replenished their supplies at ports as necessary but they are prioritizing the acquisition of cargo to maintain high levels of inventory at the port.

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 $0.4/t this week to $13.9/t on 5 June, as per BigMint's assessment.

Route-wise freight specifications:

India-China: Freight rates from the Indian Ocean to China declined this week. As per sources, a Supramax vessel has been booked from Gopalpur, India to Tianjin, China at a freight of $13.8/t for mid June shipment, sources informed BigMint.

Australia-China: Australian mining company Rio Tinto is actively seeking tonnages for June shipments at levels of $11/t. Several inquiries have been secured for mid-June deliveries, while others are still being discussed. Meanwhile, freight rate from the Australia-to-China route have witnessed an increase this week by $0.55/t to $11/t today.

Rio Tinto booked one Capesize vessel from Dampier, Australia to Qingdao Port, China, at $11/t, for 15-17 June shipment, as per sources.

Brazil-China: Enquiries in the Pacific region remained active this week. However, freight rates have seen a slight decrease this week. Two Capesize vessel were booked at the beginning of the month for shipments in the third and fourth weeks of June.

South Africa-China: Freight rates from Saldanha Port to Qingdao have dropped this week. However, an enquiry for a Capesize vessel for mid-June shipment is under negotiation.