Baltic index edges down as demand for smaller vessels slips

January 5, 2024

The Baltic Exchange’s dry bulk sea freight index eased on Wednesday, as falling rates for panamax and supramax vessels overshadowed gains in the capesize segment.

The overall index, which factors in rates for capesize, panamax and supramax shipping vessels, was down 2 points, or 0.1%, at 2,091.

The capesize index was up 85 points, or 2.4%, at 3,569, its highest in more than two weeks.

Average daily earnings for capesize vessels, which typically transport 150,000-tonne cargoes such as iron ore and coal, increased $703 to $29,599.

Iron ore futures rose for the second consecutive session, buoyed by expectations of additional fiscal stimulus in top consumer China and bets of industry growth.

The panamax index was down 64 points, or 3.4%, at 1,808, its lowest level since Nov. 16.

Average daily earnings for panamax vessels, which usually carry about 60,000 to 70,000 tons of coal or grain cargo, fell by $580 to $16,271.

Among smaller vessels, the supramax index, down for the 15th consecutive session, hit a more than five-week low. It fell 37 points to 1,271.

The Baltic Exchange observed a week-long holiday from Dec. 25 to Dec. 29, 2023.

In response to attacks on vessels in the Red Sea by Iranian-backed Houthi militants in Yemen, some of the world’s largest shipping companies have diverted vessels around southern Africa’s Cape of Good Hope, adding time and costs to voyages.

Denmark’s Maersk said on Jan. 2 it would “continue to pause all cargo movement through the area while we further assess the constantly evolving situation”.

Source: Reuters reported by Anjana Anil in Bengaluru and edited by Shilpi Majumdar

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