SGX, which now owns the Baltic Exchange and its benchmark indices, noted that the 20% fall in the BDI in December 2016 was the biggest decline since the first month of the year. The fall was driven by the capesize and panamax sectors, with handysize rates actually up 11% in December.
Forward rates have continued to hold up providing some optimism in the market. “In spite of the general decline in most spot rates during December, forward expectations for 2017 were little affected and rose moderately for most vessel classes. Forward curves imply seasonally weaker rate expectations across all vessel types over Jan/Feb, before improving through Q2/Q3 2017,” SGX said in its monthly report.
The forward rates reflect a sense the dry bulk market may finally be past the worst of the downturn. “Better-than-expected demand in 2016, improved global industrial activity and steel demand, as well as a relatively slim order book have left the market with a sense of cautious optimism on the outlook for 2017,” the report said.
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