Wed Aug 8, 2012
Aug 8 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry commodities, dropped on Wednesday due to a scarcity of fresh cargoes.
The main index, which gauges the cost of shipping commodities including iron ore, coal and grain, fell 2.87 percent or 24 points to 812 points.
"Spot fixture activity in both the Atlantic and Pacific basin continues to be muted, with only a trickle of spot cargoes and plenty of available tonnage keeping pressure on rates," analyst Herman Hildan of RS Platou Markets said in a note.
The Baltic Exchange's capesize index slipped 33 points to 1,204 points, a drop of 2.67 percent. Average daily earnings of capesizes, which usually transport 150,000 tonne cargoes such as iron ore and coal, plunged $386 to $4,210.
An increased number of ships and overall lack of cargoes is affecting the capesize segment, ship broker Fearnleys said in its weekly note.
Shipments of iron ore, a raw material for steel manufacturing, account for around a third of seaborne volumes on the larger capesizes, and brokers said price developments remained a key factor for dry freight.
China's steel futures slipped for a fourth day in six on Wednesday as sluggish demand kept pressure on spot prices of raw material iron ore, and further weakness was expected in both commodities before the start of any recovery.
The Baltic's panamax index fell 28 points or 3.23 percent to 840 points.
The average daily earnings for panamaxes, which typically transport 60,000 to 70,000 tonne cargoes of coal or grain, dropped $223 to $6,698.
"The holiday season is now seemingly in full swing, and we have experienced yet another slow week. Overall the market maintains its slow but steady decline with lack of fresh cargoes and a growing fleet list," Fearnleys said about the panamaxes.
Average daily earnings for handysize and supramax ships fell to $7,819 and $9,888, respectively.
Smaller segments continued to weigh on the Baltic Dry Index as a downtrend in both panamax and supramax is yet to see a reversal, Hildan said.
Growing ship supply has been outpacing commodity demand and is widely expected to weigh on dry bulk freight rates in the coming months.
(Reporting by Naveen Arul in Bangalore, editing by Jane Baird)
Aug 8 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry commodities, dropped on Wednesday due to a scarcity of fresh cargoes.
The main index, which gauges the cost of shipping commodities including iron ore, coal and grain, fell 2.87 percent or 24 points to 812 points.
"Spot fixture activity in both the Atlantic and Pacific basin continues to be muted, with only a trickle of spot cargoes and plenty of available tonnage keeping pressure on rates," analyst Herman Hildan of RS Platou Markets said in a note.
The Baltic Exchange's capesize index slipped 33 points to 1,204 points, a drop of 2.67 percent. Average daily earnings of capesizes, which usually transport 150,000 tonne cargoes such as iron ore and coal, plunged $386 to $4,210.
An increased number of ships and overall lack of cargoes is affecting the capesize segment, ship broker Fearnleys said in its weekly note.
Shipments of iron ore, a raw material for steel manufacturing, account for around a third of seaborne volumes on the larger capesizes, and brokers said price developments remained a key factor for dry freight.
China's steel futures slipped for a fourth day in six on Wednesday as sluggish demand kept pressure on spot prices of raw material iron ore, and further weakness was expected in both commodities before the start of any recovery.
The Baltic's panamax index fell 28 points or 3.23 percent to 840 points.
The average daily earnings for panamaxes, which typically transport 60,000 to 70,000 tonne cargoes of coal or grain, dropped $223 to $6,698.
"The holiday season is now seemingly in full swing, and we have experienced yet another slow week. Overall the market maintains its slow but steady decline with lack of fresh cargoes and a growing fleet list," Fearnleys said about the panamaxes.
Average daily earnings for handysize and supramax ships fell to $7,819 and $9,888, respectively.
Smaller segments continued to weigh on the Baltic Dry Index as a downtrend in both panamax and supramax is yet to see a reversal, Hildan said.
Growing ship supply has been outpacing commodity demand and is widely expected to weigh on dry bulk freight rates in the coming months.
(Reporting by Naveen Arul in Bangalore, editing by Jane Baird)
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