Baltic Index inches Up on Higher Capesize, Supramax Rates

LONDON : The Baltic Exchange’s Dry Bulk Sea Freight index, which measures shipping rates for vessels transporting dry bulk commodities, rose on Monday to snap a four-session losing streak buoyed by higher capesize and supramax rates.

The main index, which monitors rates for capesize, panamax and supramax shipping vessels, gained 5 points, or 0.39%, to 1,304, its highest level since May 8.

The capesize index rose by 22 points, or 1.29%, to 1,731.

Average daily earnings for capesize vessels, which typically transport 150,000-ton cargoes such as iron ore and coal, increased by $185 to $14,354.

Iron ore futures prices climbed on Monday as the world’s two largest economies agreed to a deal to slash reciprocal tariffs and a 90-day pause on measures lifted investor sentiment.

The panamax index shed 11 points, or 0.81%, to 1,342, its lowest since April 23.

Average daily earnings for panamax vessels, which usually carry 60,000-70,000 tons of coal or grain, were down $98 at $12,075.

“Brazilian shipments’ traditional strong period until May is now over so we are witnessing a decline in Panama trade…coal shipments to China have decreased as well but the main reason (for declining rates) is the (decreasing) Brazil grain shipments,” said Yiannis Parganas, head of Intermodal’s research department.

In a substantial de-escalation, the U.S. and China said they have agreed on a deal to slash reciprocal tariffs as they seek to end a trade war that has disrupted the global economy.

“We could see a rise in rates in the short term (on this news) but there’s skepticism on how this negotiation will end up,” Parganas added.

Among smaller vessels, the supramax index added one point to 970.

Source: Reuters