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Dry Bulk Market Report: Capes Under Significant Pressure as Smaller Segments Remain Relatively Stable

By Iakovos (Jack) Archontakis
Senior Maritime Strategy Consultant-Chartering Executive & TMC Shipping Commercial Director

and

Dr Fotios-Evangelos Karlis
Maritime Executive & Shipping Consultant

The dry bulk market experienced a fresh downturn this week compared with the previous week, primarily driven by a significant decline in Capesize rates, which recorded double-digit losses. In contrast, the smaller vessel segments remained broadly at similar levels, with only marginal fluctuations.

More specifically, Capesize rates fell by 13.92%, while Kamsarmax and Ultramax rates increased by 2.18% and 1.38%, respectively. Handysize rates, meanwhile, registered a marginal decline of 1.07% week-on-week. As a result, the Baltic Dry Index (BDI) fell by 231 points over the course of the week, closing at 2,917 points on Friday, 9 October.

Let us now take a closer look at the performance of the dry bulk market by vessel size and geographical region, starting with the Capesize segment.

Capesize

In Asia, the market demonstrated greater resilience, supported by a satisfactory volume of fixtures. The key West Australia–China route (C5) remained particularly active throughout the week, with numerous vessels securing employment. However, this heightened fixing activity was not reflected in the corresponding market figures. The index for the Australia–China route (C5) closed at $14.24 per tonne on Friday.

In the Atlantic, and particularly in the southern region, downward pressure was observed on rates for cargoes originating from southern Brazil and West Africa and destined for China. This was attributed to the increased number of vessels heading towards the region, resulting in a decline of approximately $4 per tonne over the course of the week.

The picture was similar in the North Atlantic, where losses were recorded across all routes. On Friday, the index for the Brazil–China route (C3) stood at $33.29 per tonne. Meanwhile, rates for Europe–Asia voyages (C9) closed at $78,530 per day, while transatlantic round voyages (C8) settled at $43,910 per day.

Kamsarmax

In the Atlantic, the market gained momentum as the week progressed, with stronger demand for transatlantic voyages absorbing a substantial proportion of the available tonnage in both the northern and southern regions. The North Atlantic was particularly active, while the southern Atlantic also saw a considerable number of voyages fixed to Asia.

By way of indication, rates for voyages from the East Coast of South America (ECSA) to the Far East stood at $22,500–$24,500 per day, plus a ballast bonus of $1.2–$1.4 million, with delivery in the Americas. Rates for Europe–Asia voyages ranged between $29,500 and $31,500 per day, with delivery in Europe, while transatlantic round voyages were assessed at $21,000–$23,000 per day, with delivery in Gibraltar.

In Asia, the week began on a subdued note due to various public holidays. However, activity gradually picked up as the days went by, with increased activity from Australia and the North Pacific, where several new cargoes emerged. Rates for round voyages within Southeast Asia and the Far East ranged between $25,000 and $27,000 per day, with delivery in the Far East.

Ultramax

In Southeast Asia, the market moved upwards, with several fixtures concluded at higher levels compared with the previous week. Ultramax rates for voyages between Southeast Asia and the Far East stood at $19,500–$21,000 per day.

Further north, in the Far East, the market remained in owners’ favour, supported by a healthy volume of grain cargoes from the North Pacific (NOPAC), alongside increased interest in period charters. Ultramax rates for NOPAC round voyages ranged between $20,500 and $22,000 per day. Voyages to India were assessed at $24,500–$26,000 per day, while backhaul voyages towards the Atlantic were quoted at $18,500–$20,000 per day.

In the Middle East Gulf and West Coast India (WCI), the market remained broadly stable. On the one hand, India recorded strong activity; on the other, activity out of Oman remained subdued. Rates for voyages to the Far East ranged between $14,500 and $16,000 per day, with delivery on the West Coast of India (WCI).

In the Atlantic, and particularly in the US Gulf, the market remained largely stagnant, with no clear directional trend emerging. Although there were discussions surrounding cargoes for shipment towards the end of the month, the long list of available vessels prevented any further meaningful movement in the market.

Ultramax rates for transatlantic voyages ranged between $30,000 and $31,500 per day, while rates for voyages to Asia stood at $33,500–$35,000 per day.

The East Coast of South America (ECSA) remained relatively balanced, with freight rates maintaining their momentum. Activity was healthy for both Asia-bound and transatlantic voyages. Rates for voyages to Southeast Asia and China ranged between $34,000 and $35,500 per day, while voyages to the Mediterranean and Europe were assessed at $35,500–$37,000 per day.

The European market began the week quietly, with limited activity and few fresh cargoes. As the week progressed, however, conditions improved gradually, allowing some vessels to secure employment. By the end of the week, market sentiment had turned more positive, with supply and demand remaining broadly balanced.

Rates for intra-European round voyages ranged between $22,500 and $24,000 per day. Rates for scrap cargoes destined for the Mediterranean stood at $33,500–$35,000 per day, while those for scrap shipments to Asia ranged between $31,500 and $33,000 per day.

The Mediterranean market displayed a two-tier pattern, with differing conditions between its western and eastern basins. In the western Mediterranean, demand was stronger, while several vessels repositioned towards southern Brazil. By contrast, the eastern Mediterranean experienced limited demand alongside an increasing supply of available tonnage.

Indicatively, an Ultramax voyage from the Mediterranean to Asia was being fixed at $24,000–$25,500 per day, with delivery at Canakkale. Rates for voyages to the other side of the Atlantic ranged between $11,500 and $13,000 per day, while intra-Mediterranean voyages were assessed at $16,500–$18,000 per day, excluding war zones.

Handysize

In Europe, the market remained broadly stable compared with the previous week. Although the week began on a weaker footing, activity gradually improved as the days progressed, accompanied by a recovery in freight rates.

For the larger vessels in the segment, rates for round voyages ranged between $23,000 and $24,500 per day. Scrap shipments to the Mediterranean were assessed at $27,500–$29,000 per day, while transatlantic voyages were quoted at $15,000–$16,500 per day.

The Mediterranean market moved upwards. A sudden increase in demand from the Black Sea and Morocco contributed to the improvement in freight rates. Additional support came from Latin America, which represented an attractive alternative employment option for shipowners.

Rates for the larger vessels in the segment, with a carrying capacity of more than 36,000 dwt, ranged between $13,000 and $14,500 per day for intra-Mediterranean voyages, $12,000–$13,500 per day for voyages to Europe, and $9,500–$11,000 per day for voyages to the other side of the Atlantic. Rates for voyages to Asia stood at $22,000–$23,500 per day, with delivery at Canakkale.

In the US Gulf, the market began the week with a slight downturn. However, an increasing number of cargoes entered the market as the days progressed, helping to restore a balance between supply and demand. Rates for the larger vessels in the segment stood at $18,500–$20,000 per day for voyages to the other side of the Atlantic and $15,500–$17,000 per day for voyages to Asia.

The East Coast of South America (ECSA) market moved through the week without any significant changes. A steady flow of fresh cargoes absorbed a substantial proportion of the available tonnage. Rates for transatlantic voyages to Europe and the Mediterranean ranged between $27,000 and $28,500 per day, while rates for voyages to Asia stood at $26,500–$28,000 per day.

In Asia, and particularly in the northern region, the week was relatively quiet due to China’s Golden Week holiday. The limited activity that did emerge was concentrated mainly towards the end of the week. In contrast, the market in Southeast Asia performed positively, closing higher as activity resumed following the holiday period.

Further west, in the Middle East Gulf and India, the market showed signs of recovery, supported by stronger demand from India and a gradual reduction in the number of available vessels. Activity out of Oman, however, remained limited.

Rates for larger Handysize vessels on round voyages in the Far East and the North Pacific (NOPAC) ranged between $17,500 and $19,000 per day. Voyages from Southeast Asia to China were assessed at $18,000–$19,500 per day, while rates for voyages from West Coast India to China stood at $11,500–$13,000 per day.

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This report is provided solely for general informational purposes and does not constitute investment or commercial advice. The information herein is based on sources believed to be reliable but is not guaranteed for accuracy or completeness. Any actions taken based on this content are the sole responsibility of the reader.