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Asia Dry Bulk -Capesize rates to climb as owners, charterers play cat and mouse

Published 17/09/2015, 06:03 pm
© Reuters.  Asia Dry Bulk -Capesize rates to climb as owners, charterers play cat and mouse
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* Shipowners confident rates will climb on tighter tonnage supply -broker

* Shipowners seek rates premium for Australian coal cargoes -broker

By Keith Wallis

SINGAPORE Sept 17 (Reuters) - Freight rates for capesize bulk carriers could continue to recover as ship owners scent the possibility of higher cargo volumes on tighter tonnage supply, ship brokers said.

"Owners and charterers are playing a game of cat and mouse," said a Singapore-based capesize ship broker.

Charterers were offering $12 per tonne for a capesize iron ore cargo from Brazil to China while owners were holding out for $13 per tonne, a Shanghai-based broker told Reuters on Thursday.

"Owners do have confidence rates will increase and are grabbing the chance to push up the market," the Shanghai broker said.

"The number of open vessels is getting fewer," the Shanghai broker added.

Freight rates from Brazil and South Africa to Asia had firmed in the last two days as operators including Cargill CARGIL.UL and Pan Ocean chartered capesize vessels to haul iron ore, Reuters freight data and another Singapore capesize broker said.

"BHP Billiton (LONDON:BLT) BHP.AX and Rio Tinto (LONDON:RIO) RIO.AX are back in the market today so rates from Australia to Asia will follow suit," the second Singapore broker said.

Higher capesize rates for iron ore cargoes had spilled over into Australian coal shipments with shipowners seeking $1-$1.50 per tonne more than for iron ore cargoes from Western Australia, the Shanghai broker said.

"Owners are aggressive on the numbers - asking $6.50-$7 per tonne - for coal cargoes," the Shanghai broker said.

Australian coal exports are expected to climb by 1 percent to 375.6 million tonnes this year, according to British shipping services firm Clarkson CKN.L .

South Korean coal imports will grow 4 percent to 133.2 million tonnes and Indian imports by 11 percent to 240.1 million tonnes, while Chinese coal imports are forecast to drop 30 percent to 168.5 million tonnes, Clarkson said.

Charter rates for the Western Australia-China route .BAWB were around $5.30 per tonne on Wednesday, virtually unchanged from about $5.39 per tonne a week ago. Rates dropped at the end of last week before rebounding this week.

Rates for the Brazil-China route .BATB were steady at around $11.40 per tonne on Wednesday, the same as last week.

Panamax rates for a north Pacific round-trip voyage .BPHJ climbed to $5,873 per day on Wednesday, up from $5,832 per day the same day last week, on increased cargo demand.

"The market feels pretty good - rates are beginning to pick up," said a Singapore-based panamax broker on Thursday.

Freight rates for smaller supramax vessels were around $5,000 per day for an Indonesia roundtrip voyage, ship broker Fearnley said in a Wednesday note.

The Baltic Exchange's main sea freight index .BADI fell to 814 on Wednesday, down from 855 last week.

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