Tue Apr 17, 2012
April 17 (Reuters) - The Baltic Exchange's main sea freight index, used to track rates for ships carrying dry commodities, climbed to its highest level since January, due to high panamax activity.
The main index, which factors in the average daily earnings of capesize, panamax, supramax and handysize dry bulk transport vessels, rose 14 points or 1.44 percent to 989 points.
"While we continue to expect dry bulk rate volatility, we continue to expect the oversupply of tonnage to keep rates in check through the majority of 2012," Wells Fargo senior analyst Michael Webber said in a note.
The Baltic's panamax index gained 3.62 percent. Average daily earnings for panamaxes, which usually transport 60,000-70,000 tonne cargoes of coal or grains, reached $9,851.
The average daily earnings for handysize and supramax ships rose to $8,272 and $10,004, respectively.
Baltic's capesize index dipped 0.32 percent to 1,542 points, with renewed weakness in the Pacific Basin.
"Capesize extended their decline at the start of the week as only a handful of spot cargoes entering the market weighed on the segment," RS Platou Markets analyst Herman Hildan said in a note to clients.
Average daily earnings for capesizes, which typically transport 150,000 tonne cargoes such as iron ore and coal, fell to $6,721, down about 76 percent this year.
China, which buys around 60 percent of the world's iron ore, saw its economy expand at the slowest pace in nearly three years in the first quarter, with annual growth coming in at 8.1 percent.
Iron ore shipments account for around a third of seaborne volumes on the larger capesizes, and brokers said price developments remained a key factor for dry freight.
The overall index, which gauges the cost of shipping commodities such as iron ore, cement, grain, coal and fertiliser is down about 43 percent this year.
(Reporting by Naveen Arul in Bangalore;editing by Sofina Mirza-Reid)
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