The Baltic Exchange’s main sea freight index, tracking rates for ships carrying dry bulk commodities, on Wednesday posted its biggest single-day gain since March, as higher South American exports supported demand for capesize vessels.

The overall index, which factors in rates for capesize, panamax and supramax shipping vessels, gained 105 points, or 11%, to 1,067 — its highest level since July 17.

The capesize index rose 310 points, or 21.8%, to 1,734, its highest since March 1.

Iron ore flows from east coast of South America to China and some coal shipments from Colombia to Europe are the main factors that contributed to the current upward momentum in capesizes, said Yiannis Parganas, head of Intermodal Research Department.

Average daily earnings for capesizes, which typically transport 150,000-tonne cargoes carrying commodities such as iron ore and coal, increased $2,573 to $14,379.

The harvest period being very good for Brazilian soybean exporters has contributed to a price advantage compared to the U.S., which combined with increased demand of soybean from China has helped with the uptick in vessel rates, Parganas added.

The panamax index was up 21 points, or 2.4%, at 916 — snapping its eight-session losing streak.

Average daily earnings for panamaxes, which usually carry coal or grain cargoes of about 60,000 to 70,000 tonnes, increased $190 to $8,244.

Capesizes could continue to outperform the overall dry bulk market, but the unresolved real estate crisis in China may keep rates from surging, BIMCO shipping analyst Filipe Gouveia said.

“In the near term, rates for handysize and supramax ships are also unlikely to substantially strengthen, as slow global economic conditions may limit growth for minor bulks,” Gouveia added.

Among smaller vessels, the supramax index fell 11 points, or 1.5%, to 742.

Source: Reuters reported by Sherin Elizabeth Varghese in Bengaluru and edited by Shilpi Majumdar