By Thursday, the Baltic Dry Index (BDI) had touched back to the high 1,376 points since 25 April 2018. The higher freight rates pointed to the market optimism in stronger steel demand as well as the greater demand on iron ore.
Since Wednesday, the Capesize freight rates for the Asia-Pacific region had went up higher and this bullish tone then continued throughout the end of the week. A FIS shipbroker noted that the rates of the big ships moved up for the key West Australia and China routes.
With physical market on the rise, the paper market sparked into life with the entire curve lifting and some good volume changing hands on the close of business day on mid-week.
“Capesizes took on a bullish tone in the Thursday morning session although most of the focus was on the prompt periods.” said a FIS shipbroker on the market of 3 May 2018.
Later, the talks of improved rates in both basins was reflected in the indices but this failed to bring more buyers into the market in the afternoon session of Thursday. Overall, the Capesize 5 Time Charter Average posted at $18,126 on Thursday, up $777 day-on-day, and up $950 from the $17,176 recorded on Monday.
Similarly, the Panamax market gained stronger momentum toward the end of the week, with the trade participants coming back from the Labour Day holiday. The upticks were seen in Wednesday, 2 May 2018 with small gains on the Panamax paper market.
“We witnessed a firmer start on Panamax paper with the uptick in activity in both basins and the firmer cape market fueling optimism on the Thursday trading day,” observed one FIS Freight Forward Agreement (FFA) broker.
According to him, the market saw some sharp gains added across the curve with May trading up to $11,050 and June breaking $12,000 resistance to print $12,100 high, while further out Q3 traded $12,450 and Cal19 traded $11,750 several times. However, the Panamax Time Charter Average posted a loss of $38 on-day, to $10,185 at Thursday, down $76 from the rate of $10,261 recorded on Monday.
Meanwhile, the Supramax paper market had a rather quiet week, before seeing gains late in the week. The thin trading soon gave in to the stronger freight demand toward the end of week.
“Supramax paper opened with a stronger feel on Thursday as we saw the May and June package trading at $11,350, and with Q3 followed suit trading at the $11,850- $12,000 range,” concluded a FIS shipbroker. As a result, the Supramax time charter average went up by $15 day-on-day to $11,151 on Thursday, while Handysize market has a quiet week and saw time charter average at $8,629 on Thursday, down $87 on-day.
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