Panamax coal freight rates on established routes from South Africa's Richards Bay and Indonesia to India ended the week stable to slightly lower, even as a number of vessel fixtures were reported, as there were not enough cargoes to absorb the excess tonnage, sources said Friday.
Activity on the Richards Bay to India route saw an upturn this week, with several coal fixtures being reported, sources said.
A Panamax cargo was reportedly fixed from Richards Bay to Dahej port on the west coast of India at $13.50/mt, while a Capesize cargo was fixed to Gangavaram Port on the east coast at $11/mt, sources said.
A vessel also fixed to ship 60,000 mt of coal from South Kalimantan to Dahej Port on the west coast of India at $9/mt, sources added.
"Freight market is slightly better this week as there are a lot of fertilizer and coal cargoes available," a Singapore-based source said. "East coast of South America [ECSA] grain activity also remains strong," he said.
Nearly 250-300 vessels were still waiting in ECSA for cargoes, he noted.
A second Singapore-based source noted that although freight rates were rising, the reason for the upward push was still not clear.
He said freight rates, however, still remained low even after this recent rise.
"Activity was uninspiring in both basins, and despite the fact that in the Pacific we witnessed some better volumes of enquiries, it seems that owners have started displaying some resistance, appearing hesitant to fix at these low levels, hopefully opening the way to a long due upward correction within the next few days," Greek shipbroker Intermodal said in its weekly note Tuesday.
Platts assessed the daily Panamax freight rates from South Africa's Richards Bay to India's west coast at $13.70/mt, unchanged on-day but down 30 cents on-week, and to the east coast at $14.10/mt, up 10 cents on-day but down 20 cents on-week.
Platts also assessed the daily Panamax freight rate from South Kalimantan to India's west coast at $8.70/mt, up 20 cents on-day but unchanged on-week, and to the east coast at $7.30/mt, stable on-day but down 20 cents on-week.
VESSEL OVERSUPPLY
"There is still a shortage of cargo to absorb many ballasting vessels towards EC S America and it remains to be seen if current positive sentiment will develop into a sustainable upward trend," broker Braemar Seascope said in its weekly note on Thursday.
In South America a steady flow of grain cargoes is keeping the rate levels "somewhat stable", broker Fearnleys said in its weekly note on Wednesday.
"The levels we see are still weak as the tonnage list still absorbs the fresh cargoes," the broker added.
Meanwhile, Capesize freight rates appeared to be gaining strength this week, amid plenty of reported fixtures, sources said.
A Capesize vessel was reportedly fixed to ship coal from Indonesia to Mundra Port on the west coast of India at $6.50/mt, sources noted.
"[Capesize] rates in the Pacific increased as a result of demand for prompt vessels ex-West Australia, whilst the Atlantic, unusually in recent times, made a strong contribution," Braemar noted.
The Brazil-China run also produced further enquiry, and rates on this route showed distinct improvement, the broker added.
