The Baltic Exchange’s main sea freight index on Monday rose to a more than 11-year peak on rising demand for all vessel sizes, with capesize rates extending their winning run to an 11th straight session.
The overall index, which factors in rates for capesize, panamax, supramax and handysize shipping vessels, rose 55 points, or about 1.3%, to its highest since mid-2010 at 4,147. The main index has risen for nine straight sessions.
The capesize index gained 2% or 117 points to a nearly 12-year high at 6,114. Average daily earnings for capesizes, which typically transport 150,000-tonne cargoes such as iron ore and coal, rose by $977 to $50,708.
Analysts have attributed recent gains in the index to an overall rebound in commodities demand, coupled with shipping constraints, especially in China.
Renewed coronavirus restrictions in China could affect demand and that may be apparent in the coming weeks, said Rebecca Galanopoulos Jones, head of research at Alibra Shipping. But “globally, demand is still very strong for commodities, so I don’t think we’re going to see the market weaken in the coming weeks,” Jones added.
Meanwhile, Chinese coke and coking coal futures on Monday surged to record highs, as market rumours about a suspension of Mongolian coal imports over COVID-19 concerns fuelled fears of tighter supply of the steelmaking ingredients.
The panamax index advanced 24 points, or 0.6%, to its highest in five weeks at 3,809. Average daily earnings for panamaxes, which usually carry coal or grain cargoes of about 60,000 tonnes to 70,000 tonnes, increased by $219 to $34,282. Among smaller vessels, the supramax index added 27 points to 3,303, an all-time high as per Refinitiv Eikon data available since 2017.
Source: Reuters