Meanwhile the dry cargo market staged a true rallye over the past month, led by capesizes and panamaxes whose average[ds_preview] spot t/c earnings nearly doubled. Supramaxs and handysizes posted respectable, but more modest, increases, too, spurred by high demand and tight availability on the East Coast of South America, the US Gulf and the Black Sea – the latter finally tipping the scales in favour of owners.
The concurrence of gathering grain seasons in the Black Sea and North America with continued strong flows ex ECSA lends good support to the smaller classes. However, overall the main stimulus for the dry markets supposedly comes from increased iron ore flows which mainly benefits capesizes and also panamaxes to a lesser extent.
Demand for the iron-making ingredient remains buoyant led by China where monthly steel production growth peaked at 10% year on year recently. Iron ore prices surged to multi-year highs and the return of export capacity by Brazilian miner Vale gave the freight market in the Atlantic a shot in the arm.
The market for project cargo and smaller breakbulk lots, by contrast, has not enjoyed any improvements lately. The Toepfer Multipurpose Index for 12,500 dwt multipurpose ships slightly weakened in July as many operators seemed to be sitting on the fence, gauging the freight markets. Time charter rates for slightly smaller 10,000-11,000 dwt ships with 60-80 t cranes saw spot hire rates slide from mid-6,000 to just below 6,000 $/day in the Atlantic recently, according to brokers.
In Europe, export cargo volumes tapered off in July, with agents lamenting a lack of 4,000-5,000 t general cargo lots and project cargoes necessary to fill 12,000-20,000 dwt ships for trips out east. June had seen more dry cargo stems of 10,000-20,000 dwt ex Baltic Sea (petcoke etc.), offering employment for medium to bigger mpp vessels, but that appears to have come to an end.
