The Baltic Exchange’s dry bulk sea freight index snapped four straight sessions of gains on Wednesday as a drop in capesize rates outweighed gains in the smaller vessel segments.
The overall index, which factors in rates for capesize, panamax and supramax vessels, lost 61 points, or 2.3%, to 2,654 points.
The capesize index shed 233 points, or 5.8%, to 3,822.
Average daily earnings for capesizes, which transport 150,000-tonne cargoes such as iron ore and coal, fell $1,937 to $31,694.
Chinese coking coal futures surged more than 13%, boosted by improving sentiment in the property market and expectations of higher steelmaking demand at mills.
Following a rebound in Chinese steel mill profits, more iron ore purchases and a return to seaborne coal ahead of the heating season are expected to support the dry bulk market, shipbroker Intermodal said in a weekly note dated Tuesday.
The panamax index rose 45 points, or 1.9%, to 2,378, its highest level since Nov. 17.
Average daily earnings for panamaxes, which ferry 60,000-70,000 tonne coal or grain cargoes, increased by $405 to $21,405.
The supramax index added 12 points to its highest in a week at 2,255.
Fundamental drivers of coal demand, increased congestion at Pacific discharge ports and a rebound in iron ore exports will help the dry bulk market rebound from its recent decline, before heading into the seasonal weakness in the first quarter of 2022, Intermodal said.