Baltic index slips to 1-1/2 month low on weaker vessel rates

FILE PHOTO: Cargo ships navigate the Panama Canal during an organized media tour by Italy's Salini Impregilo, one of the main sub contractors of the Panama Canal Expansion project, on the outskirts of Colon city, Panama May 11, 2016. REUTERS/Carlos Jasso/File Photo

The Baltic Exchange’s main sea freight index, tracking rates for ships ferrying dry bulk commodities, fell to its lowest since mid-February on weaker rates for all vessel segments.

The overall index, which factors in rates for capesize, panamax and supramax shipping vessels, shed 42 points or 2.5% to 1,669 points, its lowest level since Feb. 20.

The capesize index was down by 83 points, or 3.4%, at 2,354, marking its lowest level in near two months.

Average daily earnings for capesize vessels, which typically transports 150,000-ton cargoes such as iron ore and coal, was down by $693 at $19,522.

The panamax index fell by 39 points, or 2.2%, to 1,733 points, down for the tenth straight session.

Average daily earnings for panamax vessels, which usually carries about 60,000-70,000 tons of coal or grain cargo, decreased by $346 to $15,601.

“Volumes out of East Australia and other Pacific business have diminished since start of the week. Volumes out of South Africa have remained flat from last week,” shipbroker Fearnleys wrote in a weekly note on Wednesday.

Among smaller vessels, the supramax index shed 11 points, or about 1%, to 1,273 points.

Meanwhile, severe drought, which has forced the Panama Canal, one of the world’s busiest trade passages, to limit daily crossings, could impact global supply chains during a period of high demand, S&P Global said on Wednesday.

The Dalian Commodity Exchange and the Shanghai Futures Exchange will be closed on April 4 and 5 due to the Tomb-Sweeping Day holiday in China, the bourses said.

Source: Reuters