Petrochemicals of US-origin bound for the Far East Asia are expected to lose some of their price competitiveness as freight rates from US have surged $20/mt or 23% month-on-month for 5,000-12,000 mt from the US Gulf Coast to Far East Asia to stand at $103-110/mt on Friday.
According to a shipping report, freight rates for USGC to Far East Asia route jumped to about $110/mt for 5,000 mt basis cargoes by the end of the week, up $20/mt or 22% from $90/mt quoted for week ending November 11.
"Demand for chemical freight is huge in USG, and there is hardly any ship available at the moment," a ship broker based in Singapore said.
Tonnage is extremely tight for December even going into January. Most producers were heard to be actively looking for freight as they want to move their cargo out before December 31. Due to the tight amount of tonnage, rates are expected to remain firm well into January, according to market sources.
Meanwhile, market sources expect there will be a surplus of ships at end January to February, which may drag freight rates from Far East Asia down.
