Freight rates, which had fallen considerably by end-January due to the Chinese New Year closure, may show some recovery by March. However, they may not touch the November 2009 levels.

The Baltic Dry Index (BDI) has fallen considerably over the past few
weeks till end-January due to closure for the Chinese New Year. The BDI
may show some recovery by March, but it would be lower than the
November 2009 level, says an industry expert.

BDI, which is a major indicator for the dry bulk segment, has fallen to
2,963 on 28th January from an average of 3,572 in December. “The reason
is very clear; we are entering the Chinese New Year. In China they have
a complete shutdown during this period. We will see a revival in these
falling rates in about a month, in March 2010,” said Capt KS Nair,
director, bulk and tanker division, Shipping Corporation of India
(SCI). State-run SCI is the largest shipping company in India with a
huge presence in the dry bulk and tanker segment.

However, the BDI may find it difficult to retain its earlier level
reached in November 2009. Capt Nair said,”After this New Year period,
the rates will recover only up to the December levels, but the November
level may not be possible.” The BDI average in November was 3,941.

Contrary to the decline in the BDI for the dry bulk segment, certain
amount of recovery has been witnessed in freight rates for the very
large crude carriers (VLCC) segment. The freight rates in the VLCC
segment had zoomed to a high of $50,620/day on 26th January.

However, Capt Nair does not see any long-term relief. “The rates in the
VLCC segment have recovered due to the winter effect. However, for the
long-term period, they will be still steady at $28,000 to $30,000
(daily) levels,” he said.

Source: MoneyLife

Search to find what you want

• IMAREX: Trading statistics for November 2009

    Exchange segment: The volume of freight derivatives lots was up 38 % on the previous month, to 60 013, with the overall trade value increasing 87 % to USD 1 805 million. Freight options activity was up both month-on-month and year-on-year, as freight options open interest hit a new high,

• UBS holds assessment of GE Shipping

    UBS maintains `Sell’ rating on GE Shipping and raises price target to Rs 250. The stock has underperformed the broader market over the past five months by 15% because of the downward trend in freight rates in the tanker segment. The weak fundamentals of supply and demand in the tanker

• Spot freight pick-up is in safe waters, GE Shipping

    Investors are once again taking a fancy to shipping stocks, given the nascent signs of a pick-up in spot shipping freight rates in the key tanker segment over the past weeks, from the extremely low levels that prevailed in the September ’09 quarter. Given this renewed interest, the GE Shipping

• Reeder happy as freight Swell

    Shipping companies have found reason to cheer for the first time this fiscal, as the global freight market, which had been dull since the start of the year in the wake of the downturn, started to gather steam in the second half of October and all through November. Easing of

• Mercator to extend dredging, bulk and tanker segments

    Mercator Lines is planning to increase its presence in a number of new markets including the bulk, tanker and dredging segments. Reports from India say Mercator Lines Ltd plans to expand in the dredging, bulk and tanker segments in the next 12-18 months

• Mercator to extend dredging, bulk and tanker segments

    Mercator Lines is planning to increase its presence in a number of new markets including the bulk, tanker and dredging segments. Reports from India say Mercator Lines Ltd plans to expand in the dredging, bulk and tanker segments in the next 12-18 months. Expansion in its coal mining capacity is

• Two Ways to Play: German Bank Upgrades Dry Bulk Shipping

    Deutsche Bank upgraded select dry bulk shipping stocks this morning. In a research note this morning, the firm upped its target on Genco Shipping to $31 from $24 and Eagle Bulk Shipping to Hold with a $4.50 price target

• Eagle Bulk Shipping Inc. secures four-Based Index Charters

     Eagle Bulk Shipping Inc. today announced that it has chartered four of its Supramax vessels at rates that are tied to the Baltic Supramax Index (”BSI”) which provides Eagle with the flexibility of earning strong rates in the spot market while retaining the stability of a one year charter. The Skua,

• Mercator Lines to buy Rs 460 cr to five tankers

    India’s second-largest private shipping company Mercator Lines is looking at adding four to five ships in the tanker segment over the next three months as prices of vessels have crashed up to 50% from their peak two years ago.

• No increase in freight rates for shipping companies to raise morale

    A rise of about 70 per cent over 45 days in the Baltic Dry Index (BDI), the global benchmark for shipping freight rates of dry bulk carriers, has failed to cheer Indian companies, who see it as only a temporary surge. On Tuesday, BDI was 3,615, up 67 per cent

• Shipment expected flood of Chinese New Year to ride

    Shipping companies are pinning their hopes on the Chinese New Year on January 26 as the Baltic Dry Index, the benchmark for freight rates of dry bulk carriers, has dropped 35 per cent over the last 40 days.

• Better freight rates will benefit shipping, GE

    GE Shipping has announced the sale of two assets of its offshore division, namely a platform supply vessel (PSV) and an under-construction platform/ROV supply vessel.

• GE Shipping July-September net seen falling

    Great Eastern Shipping Co Ltd is seen posting over 88 percent fall in July-September net profit as freight rates slumped during the quarter, putting pressure on margins. Analysts also expect revenue days to drop as the company sold several vessels in the year, while brokerage KR Choksey sees operating margin

• ICRA downgrades the issuer rating of Shipping Corporation

    Credit rating agency, ICRA has revised the issuer rating of Shipping Corporation? of India (SCI) from IrAAA to IrAA+. The rating is only an opinion on the general credit worthiness of the rated entity and not specific to any particular debt instrument.

• Stena Bulk Focuses on South America

    Stena Sonangol Suezmax Pool has opened a representation office in Rio de Janeiro and Stena Bulk will add two new Suezmax tankers to the pool. “We are very pleased to be able to expand our collaboration with Petrobras still further as a result of geographical proximity and we anticipate that