Ocean Paradox: MR Tankers Surge as Capesize Dry Bulk Market Falters
The latest weekly report from the Baltic Exchange reveals a polarized maritime market. While long-haul dry bulk rates faced significant downward pressure, product tankers in the Atlantic region witnessed an unprecedented price explosion.
Dry Bulk Turmoil: Capesize Index Slumps
The heavy-lift Capesize sector endured a challenging week as the average 5-route earnings index (BCI 5TC) slid from the low $31,000s to settle at $26,468. Despite miner presence in West Australia, the C5 route corrected sharply from mid $9.00s to the low $8.00s. Similarly, Brazil and West Africa to China routes remained muted due to limited activity, with rates grinding down to the high $22.00s by week’s end.
Panamax Under Pressure; Resilience in Mid-Sized Segments
The Panamax sector also saw a steady decline, with the P5TC index falling from $15,735 on Monday to $14,865 by Friday. A shortage of fresh cargo in the Atlantic combined with growing tonnage lists shifted leverage in favor of charterers. Conversely, the Ultramax and Supramax markets showed more dynamism in the Atlantic. In the US Gulf, Ultramax vessels for transatlantic trips were fixed at rates in the mid-$25,000s.
Steady Gains in Handysize Market
The Handysize market maintained a stable and optimistic tone. Notable fixtures this week included a 40,000-dwt vessel from Argentina to Morocco at $20,000 and another from Houston to Nador at $19,000. In the period market, a newbuild vessel was secured for three years at 120.5% of the BHSI index.
Stability for Crude Giants; Aframax Sector Weakens
In the crude tanker market, VLCC rates remained firm. The Middle East Gulf to China (TD3C) route held steady at WS137.17, yielding impressive daily earnings of $122,666. However, the Aframax sector struggled, particularly on the US Gulf/Mexico route (TD26), which plummeted 48 points to WS306.72. North Sea (TD7) rates also faced a 35-point decline.
83% Earnings Surge: MR Tankers Become Market Stars
Medium Range (MR) tankers in the Atlantic were the undisputed winners this week. The US Gulf to UK-Continent (TC14) route surged by 100 points to WS298, driving daily earnings up by 83% to reach $42,297. Furthermore, the MR Atlantic Triangulation Basket TCE jumped from $31,900 to $51,700 per day. In contrast, LR2 rates in the Middle East softened, with the MEG to Japan route sliding to WS190.
