2007

A Snapshot of the Dry Cargo Freight Market

In light of all the excitement surrounding the dry bulk market, we thought we would include a few words from our in-house dry bulk expert…please enjoy.

Notwithstanding the holiday inspired reduced cargo inquiry in the dry cargo charter markets over the last few weeks, and the continuing stream of newly built vessels joining the fleet, rates have not really fallen much (on a few routes they have actually firmed). Somehow the supply-demand equation has been altered and it seems that this can be traced to two factors.

Voyage charterers in the ore and coal sectors seem to have dug their heels in and taken the position that they should not have to pay spot rates for forward positions (“backwardation”). As a result Owners have adopted the strategy of running their ships spot and are generally rewarded for it. While this seems to be more prevalent in Panamax and smaller sizes in the Atlantic, it seems it work in Capes as well in the Pacific-Rim market.

This is only an excerpt of Market Commentary – 07/19/2007

Content is restricted to subscribers. To continue reading please Log-In or view our subscription options.