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Vale's dam collapse weighs heavy on dry bulk freight marketVale's dam collapse weighs heavy on dry bulk freight market

It was the usual time of the year again, when the market takes a break for the Lunar New Year celebration for the week, but it was also rocked by the unfolding events from Vale’s dam collapse incident, which could greatly impact on seaborne iron ore supply.

Marcus Hand, Editor

February 11, 2019

2 Min Read
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So far, the Brazilian miner may potentially lose a further 30m mt per year of iron ore output from its Brucutu mine due to a court ruling. This was on top of the 40m mt per year output loss from the miner’s decision to decommission ten dams after the recent fatal dam collapse in Brumadinho.

Gloomy, gloomy Capesizes

With the possibility a total of 70m mt reduction from the Brazil to China route, the Capesize market have a bitter fruit to chew and little to cheer for throughout the week.

Expectedly, an aggressive sell off was seen in the Capesize paper market this week, fanned by the troubled news from Vale.

The sell-off may deepen further as the market sees little bright spots at the largely absent Chinese trade participants celebrating their weeklong Spring festival.

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Thus, there was a general market consensus that freight rates should slide further especially on the Tubarao to Qingdao route. The only optimism probably hinges in waiting for the return of Chinese traders next week for better market clarity.

Thus, the Capesize 5 time charter average recorded $8,230 on Thursday, down $527 day-on-day and down $518 since the start of the week.


Choppy waters for Panamaxes

It was not all gloom and doom for the Panamax as compared to the larger ladies. There was some moment to shine for the Panamax paper market with some buyers returning in the week.

There was some support down the curve despite little trades seen in Asia and Europe as well as the embattled Capesize market. As such, the Panamax time charter average registered a gain of $67 day-on-day to $4,506 on Thursday and up $71 from Monday’s average.

Late support for smaller vessels



With the sell-off in Capesize market, the Supramax paper market managed to overcome some early selling pressures and stabilized as the week ended. Overall, the Supramax market remained well supported with some competitive offers despite a quiet Lunar New Year market.

By Thursday, the Supramax time charter average witnessed some index bid support and recorded in green at $4,840, up $3 day-on-day, while the Handysize time charter suffered a drop of $70 day-on-day to $4,198.

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About the Author

Marcus Hand

Editor

Marcus Hand is the editor of Seatrade Maritime News and a dedicated maritime journalist with over two decades of experience covering the shipping industry in Asia.

Marcus is also an experienced industry commentator and has chaired many conferences and round tables. Before joining Seatrade at the beginning of 2010, Marcus worked for the shipping industry journal Lloyd's List for a decade and before that the Singapore Business Times covering shipping and aviation.

In November 2022, Marcus was announced as a member of the Board of Advisors to the Singapore Journal of Maritime Talent and Technology (SJMTT) to help bring together thought leadership around the key areas of talent and technology.

Marcus is the founder of the Seatrade Maritime Podcast that delivers commentary, opinions and conversations on shipping's most important topics.

Conferences & Webinars

Marcus Hand regularly moderates at international maritime events. Below you’ll find a list of selected past conferences and webinars.

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