Later, it was heard that shipping activity were resuming in Guinea, but the positivity of the news did not stop the falling freight rates. In the meantime, the freight derivative did not help to lift the market as the paper contracts went into the negative regions on Wednesday, 16 May 2018.
As such, the Capesize 5 Time Charter Average dropped by $155 to register $20,646 on Wednesday, while May and Jun contracts were in red, down $1,000 day-on-day to $18,250 and down $1,325 day-on-day to $16,375 respectively.
“Another negative day for the futures on Wednesday as uncertainty remained in the physical market,” commented a FIS Freight Forward Agreement (FFA) broker.
In his opinion, the Capesize volumes were good but the front end of the curve was especially hard hit.
“Should the physical decline not come to fruition, we could well see the paper do an about-turn,” he added .
As things turned sour for Capesize market, Panamax also lost some grounds on Wednesday but with smaller loses as compared to their bigger counterpart.
“Despite the early selling on Wednesday, the curve remained largely unchanged by the close with some small losses on June and July contracts which gave up an average $100 on the day to print $11,350 and $12,000 lows respectively,” said a FIS Panamax broker.
Thus, the Panamax Time Charter Average closed at $9,971 on Wednesday, down slightly by $23 at day-on-day basis. However, the Q3 and Q4 contracts maintained good support at current levels of $12,300 and $13,200 respectively with little change further out.
Smaller vessels type were less impacted by the force majeure declaration in West Africa with almost flat freight rates throughout the week. Supramax witnessed a rather quiet week with a static curve as time charter average dipped by $1 day-on-day to $10,996 on Monday.
By Wednesday, the time charter average had softened to $10,954, down by $5 at day-on-day basis and down by $42 since the beginning of the week.
“Supramax paper market has found some support on Wednesday, after the recent softening we have seen on the curve,” observed a FIS shipbroker based in Asia.
Later, the trading session saw more positivity among Q3 and Q4 contracts trading around the level of $11,850 and between $12,200 and $12,400 level respectively.
Likewise, the Handysize market had a quiet week, with little changes on the curve and the time charter average managed to book $8,568 on Wednesday, up $16 day-on-day.
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