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India: Coal freights decline w-o-w amid soft demand

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Non Coking

BigMint Bureau

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12 Dec 2024, 19:12 IST

India: Coal freights decline w-o-w amid soft demand

Ample tonnage supply weighs on freights

Decline in bunker prices pressures rates

India's coal freights declined this week amid an oversupply of vessels in the Pacific Basin and weak cargo demand. Limited tonnage requirements, particularly for coal shipments from Australia, disrupted market equilibrium, leading to intense competition among shipowners and putting downward pressure on rates. A decline in freight derivatives and bunker prices also amplified the soft market conditions.

Notably, thermal coal stocks at Indian ports increased marginally by 2% to 13.00 million tonnes (mnt) in week 49 from 12.74 mnt in week 48 of calendar year 2024 (CY'24), according to BigMint's data.

Baltic indices fall w-o-w: The Baltic indices, which indicate trends in vessel demand, largely fell w-o-w, suggesting tepid interest. The Baltic Dry Index (BDI) was recorded at 1,167 points on 9 December, down by 187 w-o-w. However, the Baltic Panamax Index (BPI) edged up by 49 points to 1,067 on 9 December against 1,018 on 2 December. Meanwhile, the Baltic Supramax Index (BSI) was assessed at 974 points on 9 December, inching down by 6 w-o-w.

Route specifications

Australia-India rates fall w-o-w: Freights from Australia dropped $0.85/tonne (t) w-o-w, with BigMint's assessment indicating that rates for Hay Point Port to Paradip were at $13.35/dry metric tonne (dmt). Sources informed that SAIL booked a Panamax vessel from Hay Point Port to Vizag at $14.10/t, with shipment scheduled for 15-24 January 2025.

South Africa-India freights decline w-o-w: Freights from the Richards Bay Coal Terminal (RBCT) to Paradip stood at $12.3/t, down by $0.7/t w-o-w. Reduced coal demand from Indian buyers, possibly influenced by economic or seasonal factors, pressured rates.

Indonesia-India freights drop w-o-w: Freights for coal shipments from East Kalimantan to Paradip stood at $9.6/t, inching down by $1.6/t w-o-w. As per sources, a Supramax vessel was booked from Meulaboh Port to Navlakhi at $8.75/t for shipment by 18-23 December 2024.