The freight market went relatively quiet for the week, ahead of the upcoming May holiday in China. There were no last-ditch fixtures seen just before holidays period and the strong Capesize rates might be the only deterrent for the Baltic Dry Index to slide under the 1,300 level and allowed the index to stabilise at a respectable level of 1,375 reading on Thursday, 26 April 2018.
Already a strong advocate of the switch to low sulphur fuel oil instead of using scrubbers, Precious Shipping md Khalid Hashim suggested that not only is a switch to cleaner burning fuel the right thing to do, but could also be positive for the market.
This is a short week for the freight market in view of the long Easter weekend holidays ahead. As with most of the short trading week, the market is hard to read, and the situation is worsen given the context of a looming trade war.
A demand driven market recovery caused the dry bulk market to improve significantly in 2017, although from a historically low level the year before, minor bulks specialist Pacific Basin Shipping said while releasing its full year results, in which it finally returned to a $3.6m profit on revenue of $1.5bn.
Following on the heels of a strong protest from the International Chamber of Shipping (ICS) last week, European shipowners have also spoken out against a decree imposing a cabotage policy on certain commodities that Indonesia has adopted recently.
The capesize market took a hammering throughout the week as the lack of cargoes and tonnage oversupply problem persisted. The under-pressure capesize market pulled the Baltic Dry Index (BDI) to a five-month low at 1,139 points, down 25 points day-on-day at Thursday, 18 January 2018.
Hubline is keeping up the momentum to transform itself with yet another round of fund raising to raise more money to put itself on a better financial footing and for expansion into the bulk cargo segment.
Bimco says that caution will be needed in 2018 to sustain the improvement in shipping markets last year, with China remaining as the driving force of demand.
Dry bulk shipowners are not helping their own cause by a failure to scrap vessels, which will lead to an “extremely volatile” market recovery warns Precious Shipping.