Baltic index slips on weak capesize, panamax demand

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The Baltic Exchange’s main sea freight index, tracking rates for ships carrying dry bulk commodities, snapped a four-session winning streak on Tuesday, pressured by lower rates for capesize and Panamax vessel segments.

The overall index, which factors in rates for capesize, panamax and supramax shipping vessels, lost 7 points, or 0.5%, at 1,510.

The capesize index was also down 7 points, or 0.4%, at 1,986.

Average daily earnings for capesizes, which typically transport 150,000-tonne cargoes carrying commodities such as iron ore and coal, decreased $55 to $16,471.

Dalian and Singapore iron ore futures fell to a more than four-month low as sluggish steel demand in China prompted mills to curb output, raising the possibility of an oversupply of the steel-making raw material.

However, “dry bulk rates are well above the lows seen earlier this year and are currently holding at profitable levels for most shipowners,” analysts at Jefferies said.

The panamax index lost 20 points, or 1.2%, to 1,667.

Average daily earnings for panamaxes, which usually carry coal or grain cargoes of about 60,000 to 70,000 tonnes, decreased $185 to $15,001.

Among smaller vessels, the supramax index gained 4 points to 1,216 – its highest in almost a month.

“A much improved situation for Supramax owners as rates improved across the board and for the most part, recovered declines seen in some routes the week prior,” shipbroker Allied wrote in a weekly report.

Source: Reuters

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