Like Hokusai’s Great Wave, the freight market has its ups and downs, and this week we are seeing a downside – perhaps before another upsurge. As such, the Baltic Dry Index (BDI) fully captured the market sentiment and fell to 1,222 points on Wednesday after hitting a four-month peak reading of 1,266 on Monday.
The recent rally in freight rates seem to be living on borrowed time, in defiance to the typical lull that accompanies the summer season. With high rates coming in much earlier in the cycle, one wonders if the market’s stamina will last into the traditional shipping peak period of autumn.
After a wild bear chase last week, the bulls came charging back to drive freight rates back up again toward the 1,000 points level on Baltic Dry Index (BDI). Spearheading the bull charge were capesize rates which totally reversed course from last week’s bearish tone into a dash forward this week.
As tanker and bulker newbuilding vessel orders begin to rise, there has still been an overall drop in newbuilding orders in first-half 2017 across shipping segments compared to the same period last year. This as it maybe, Greek shipowners have doubled their contracting in the first half, according to data from VesselsValue.
Mitsui OSK Lines (MOL) has upped its full year profit forecast for the year ended 31 March 2018 by 20% to JPY12bn ($108.5m) as it forecasts a gradual improvement in most major shipping sectors.
Minor bulks Pacific Basin Shipping specialist believes the worst of the current dry bulk market cycle is over as first losses narrow.
Freight rates have risen in tandem with the iron ore rally as the commodity powered past the $70 per mt barrier this week. Likewise, the Baltic Dry Index (BDI) rallied to 948 on Wednesday, 20, recording seven consecutive days of increase since recording 820 points on 10 July.