Friday, November 07, 2008
TNT Dry Freight Review - November 07 2008
PANAMAX
=======
Panamax business slid quietly into the weekend. With so much attention focused
on the FFA settlements today, traders were reluctant to fix deals if another
round of financial fall-out was about to begin. Add in the number of traders
away at the Eisbein dinner in Hamburg and there was not a lot to write home
about. With so little reported done in either basin, no one was willing to
predict where the market might open on Monday. While there was some talk of
better numbers, sources did say that the only business being done was between
exceptionally credit-worthy parties, or parties sharing a "very high degree of
trust". The Baltic Panamax index inched up 5 to 836.
Out of the Atlantic, the 1999-built 74,000 dwt Carl Mesem went to an undisclosed
charterer with November 15-22 delivery Portbury for a trip with redelivery in
the East at about $10,100 daily.
Cargill was linked with the 1996-built 73,080 dwt Sanmar Progress with November
10-15 delivery Tarragona for a trip via the US Gulf and redelivery China at
$9,500 daily.
Agroship was the charterer of the 2000-built 74,716 dwt Worldlink-relet Redondo
with November 12-15 delivery Hamburg for a trip via Murmansk and redelivery
Singapore-Japan range at $9,250 daily.
Michaeli Di Stasi, Italy has fixed the 1989-built 69,406 dwt Annoula with
November 08-12 delivery La Coruna for a trip with 2 laden legs and redelivery
Skaw-Cape Passero at $8,000 daily.
In Pacific Panamax business, Fratelli D'Amato was said to have taken the
2005-built 76,294 dwt CTP-relet Red Gardenia with November 26-28 delivery
passing Muscat outbound for 12-months trading and redelivery worldwide at
$14,750 daily.
The 1994-built 68,591 dwt Hellenic Sky has reportedly fixed on subjects to GMI
with November 17-23 delivery Zhoushan for 2-5 months trading and redelivery
worldwide at $8,000 daily.
An unnamed charterer reportedly fixed the 2005-built 75,886 dwt Nord Venus with
November 15-20 delivery Kobe for a trip via NoPac and redelivery Singapore-Japan
range at $6,000 daily.
The 2001-built 74,297 dwt Evanthia was said fixed on subjects to STX Pan Ocean
with November 08-20 delivery passing Muscat outbound for a trip via Richards Bay
and redelivery in the Mediterranean at $5,000 daily.
Velos 1991 65702 dwt delivery Qinhuangdao 9/13 Nov trip via Xingang redelivery
Taiwan $3500 daily - STX Pan Ocean
CAPESIZE
========
Reports of concluded business were not available today. We are offering a
review of reports published in the last 24 hours. The Baltic Capesize index
dropped 42 to 1120.
The Capesize market presented a depressing picture this week and traders can
only be thankful the week is over. Bloomberg reported today that 20% of
capesize tonnage is sitting idle due to production cuts by mining companies,
steelmakers, and the lack of credit facilities. The report quoted Kjetil Sjuve
a shipbroker at Lorentzen and Stemoco A/S as saying that 50-100 capesizes cannot
find cargoes or their owners will not fix at the rates on offer. The precise
number of vessels at anchor is hard to calculate since many owners do not
publicize the information. Bloomberg's report also quoted Tufton Oceanic Ltd,
which they described as 'the world's largest shipping-hedge fund group' as
saying that "as many as 20% of shipping lines are at risk of breaching their
loan accords because the decline in rents has caused a similar plunge in ship
prices".
Monday may not be turn out to be a very good day either. Lloyds List reported
today that Monday is the day the freight derivatives markets will learn if any
major defaults occurred in the settlement of October trades. Today is the
deadline for these settlements. Alex Gray, Clarson Securities chief told Lloyds
List that any defaults would either be accepted and principals agree to wait for
late payments, or the principals will panic and the whole situation could then
escalate very rapidly. Clearing house LCH Clearnet reported to Lloyds that
there had been no defaults in the settling of its October FFA's.
Questions have now been raised about the $1.6 billion order placed by Brazilian
iron ore producer Vale for 12 very large ore carriers. Lloyds List reported
today that Excel Maritime Carrier's Stamatis Molaris said in an investor
conference call that the order is "out of the question now". The ships had been
set for delivery in 2010 and 2011. However, Vale has refused comment on whether
or not the order will go ahead and would not say whether or not they had paid
any deposit on the order.
From Reuters today came word that Vale will likely delay negotiations with
steelmakers for term price contracts. The iron ore producer will likely "hold
out in talks in the hopes that demand returns to something that resembles a
normal level", this according to Rogerio Zarpao, a metals analyst with Unibanco,
who was quoted in the story. According to the Reuters report, analysts are
predicting up to a 40% drop in iron ore prices for 2009.
HANDY/SUPRAMAX
==============
There was very little to say about the Handy sector today. Sources said there
had been no major change, either for good or bad. Cargoes are scarce and rates
on offer are still a shadow of what they were so recently. MarineLog reported
today that Hellenic Carrier's subsidiary Axios Maritime has cancelled the
purchase of the 2001-built 52,508 dwt Furness Timika. The agreement had called
for the payment of $69.7 million for the ship with delivery scheduled between
September 15-November 15 2008. As a result of the cancellation, Hellenic will
pay a $1 million cancellation fee and forfeit the deposit of $6.9m which it will
now release to Great Homes Maritime S.A.. The Baltic Supramax index edged up 9
to 530, while the Handysize index dropped 3 to 296.
Atlantic Handy business heard that Wilmar fixed the 1995-built V-Rod with
November 20-30 loading 55,000 tons 10% hss from the US Gulf to China at $7.00.
The 2001-built 52,224 dwt Koriana reportedly fixed to Trafigura with spot
delivery on the Continent for a balance of period to Aug/Sept 2009 and
redelivery worldwide at $5,000 daily for the first 60 days and $9,000 daily for
the balance.
From the Pacific, an unnamed charterer reportedly took the 2007-built 53,629 dwt
Delvina with November 12-15 delivery west coast India for a trip with redelivery
Singapore-Japan range at $5,000 daily.
Hareg was linked with the 1985-built 36,537 dwt Navision Bulker with prompt
delivery Karachi for a trip with redelivery east Africa at $4,600 daily.
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