It has been a busy week in the world of geopolitics. In the US, President Biden pardoned his son Hunter for tax and gun crimes which he had admitted to and been convicted for, despite earlier saying that a presidential pardon would not be given. This move ruins Biden’s reputation for probity and may speak to his fears that Trump plans to weaponize the justice department against his enemies in pursuit of retribution. Trump’s initial nominee to be attorney general, Matt Gaetz, a former Florida congressman, withdrew his nomination fearing that he would fail to receive confirmation from the Senate. He was replaced by Pam Bondi, a former attorney general of Florida, who is just as committed as Gaetz to the President’s retribution agenda. The nominee to run the Department of Defense, Pete Hegseth, is also looking shaky, not least because he is unqualified for the job.
Sycophancy, media exposure, Floridian roots, borderline criminality, and glaring inexperience are strange qualifications for the great offices
of state, but this is the Trump show. Hegseth is likely to be replaced by Ron DeSantis, Governor of Florida, after Marco Rubio, a senator from Miami, got the job at the State Department.
One must now doubt that Robert F Kennedy Jr will get cleared to lead Health and Human Services. Trump is not entirely getting his way as the bipartisan guardrails of Congress kick in.
In the Middle East, a ceasefire was called in Lebanon last week, although it looks fragile as both sides continue with sporadic attacks on each other. Israel continues its offensive in Gaza while in Syria rebels took Aleppo and Hama and have Homs and Damascus in their sights. Assad’s former allies in the Syrian civil war, Russia and Iran, are too preoccupied to help this time so that anything could happen.
Zelensky is making noises about a truce in Ukraine which could trade distant entry to Nato for some limited territorial concessions, but this might only amount to giving back Kursk, not surrendering the Donbas.
Georgia is on edge, after the pro-Russian prime minister suspended EU accession talks for four years bringing pro-Western protesters onto the streets of Tbilisi, Batumi and elsewhere.
In the Baltic, a Chinese bulk carrier, Yi Peng 3, is suspected of dragging its anchor and severing two subsea communication cables that connect Finland with Germany and Sweden with Lithuania. It is being mischievously speculated that this was a trial run for a similar mission off Taiwan where subsea communication cables could be cut to cripple the country.
In other parts of Asia, we witnessed a brief military coup in Seoul as the besieged President Yoon tried to shore up his increasingly untenable position.
In Africa, the brutal civil war in Sudan rages on while Joe Biden paid a visit to Angola to announce $600m of fresh financing for phase one in support of a multi-nation railroad link in the Lobito Trans Africa Corridor, linking the
Central African copper belt to the Angolan coast.
Geopolitical uncertainty often favours shipping.
However, the oil price is hardly budging amidst oversupply and global demand weakness, especially in China.
Opec has had to delay, yet again, its plans to reintroduce barrels to the market.
China’s record 100mt+ of steel exports are about to face a backlash from steelmakers in receiving countries. One such victim is India’s Jogindra Group whose steel mills in northern Punjab are piling up inventory despite strong demand from the domestic construction industry as it builds high-rises and highways.
A surge of cheap Chinese steel is undermining smaller steel mills and causing a scaling back of operations and potential job cuts. Such developments are familiar to many other nations that will soon be lining up protective counter-measures.
Taking bulkers and tankers, we have become reliant on benign net supply and longer ton- miles, particularly in the largest sizes, to counter weak demand volumes and rescue freight rates, but it simply is not happening.
Persistent underwhelming earnings are starting to drag down asset values and shake assumptions that the supply side will bail out the demand.
Micro supply and demand analysis is not chiming with freight realities in the market- place, and this is now starting to impact asset values.
In both the dry and wet sectors, better had been expected of Q4 and many have been left disappointed. This suggests that the grasp on demand signals is never as good as one might hope.
The demand outlook is always hard to predict, as are ton-mile multipliers caused by canal and other diversions. As geopolitical events help us less, we need a new catalyst.
Counter intuitively, might the second coming of Donald J Trump ride to the rescue?
Dry Cargo Chartering
Another very poor week for Capesize vessels as markets slumped even further. Overall Pacific activity was said to be limited, while in the Atlantic sentiment was slack with large numbers of ballasters reportedly heading in that direction.
Timecharter averages fell to $15,494, a steep decline of $5,628 from last reported. Rio Tinto took six TBN vessels ex Dampier, paying a broad range of freight from $8.70 pmt down to
$7.40 pmt by the end of the week.
Elsewhere, Sinoafrica covered 180,000 mtons 10% Freetown/China loading end of the year at
$18.25 pmt. From East Coast South America, Trafigura fixed Cape Excelsior (187,882-dwt, 2015) Sudeste/Qingdao 20/26 December at
$18.00 pmt on Wednesday, and MOL won the NSC tender on Maran Vigour (180,391-dwt, 2012) for Ponta Ubu/Japan 6 January onwards
in the high $16.00’s pmt. Vitol reportedly covered a ST TBN for 150,000 mtons 10% Puerto Drummond/Rotterdam in the low
$11.00’s pmt.
Panamax markets crept upwards this week with timecharter averages gaining $445 from last Friday to close at $9,606. There were healthier numbers seen for December-loading South American grain fixtures but fresh enquiry in Asia was restricted.
In the Pacific, Aurora Borealis (82,315-dwt, 2023) fixed delivery passing Busan for a NoPac round voyage at $9,500, Feng May (85,005-dwt, 2019) fixed delivery Takehara for a trip via East Coast Australia to South China at $12,000, and Guardian Bulk took Galapagos (75,661-dwt, 2010) delivery Cai Mep for a trip via Indonesia to China at $9,150.
In the Atlantic, Cargill chartered Belgrano (81,498-dwt, 2015) delivery Gib for a trip via the US Gulf redelivery Skaw-Gib range at
$8,250, and Atrotos Heracles (81,922-dwt, 2014) fixed delivery Aviles for a trip via the US
Gulf and Cape of Good Hope to the Far East at
$16,500.
From East Coast South America, Bunge covered several vessels including Tai Knighthood (84,434-dwt, 2021) relet from Comerge delivery at pilot station East Coast South America for a trip to South East Asia at
$14,250 plus $425,000 bb.
On period, Louis Dreyfus agreed to take on RGR Okinawa (82,000-dwt, 2025) to be delivered ex yard Hantong January 2025 for 10/15 months redelivery worldwide at
$14,250.
Supramax markets closed this week at
$12,309, down slightly from last week by only
$75. More fronthaul business came out from the US earlier in the week which pushed up the market a little.
In the South Atlantic, there was no significant change to sentiment.
The Continent-Mediterranean region was again under pressure and low rates were discussed and fixed.
The Indian Ocean had minimal improvement and was fairly flat.
The Pacific also had limited fresh cargoes in both the north and south resulting in a quiet week with rates remaining close to last done.
In the Pacific, Xin Hai Tong 59 (59,643-dwt, 2011) fixed delivery CJK for a trip redelivery Mediterranean at $12,500 for the first 60 days then $14,500 for the balance. Chang Hang Cang Hai (58,057-dwt, 2011) fixed delivery passing Singapore for a trip via Indonesia redelivery China at $12,000, and Apiradee Naree (56,512-dwt, 2012) fixed delivery Singapore for a trip via Indonesia to Cambodia at $11,500 by Tongli.
It was heard that Mandarin Hantong (56,741- dwt, 2011) was placed on subjects delivery Port Arthur for a trip redelivery Spain with petcoke at $20,000.
In the Indian Ocean, Ibrahim Jahan (56,034- dwt, 2005) fixed delivery Arabian Gulf prompt for a trip redelivery Bangladesh at
$12,000.
For the South African cargoes, it was heard that Green Genie (61,202-dwt, 2020) fixed delivery Maputo prompt for a trip redelivery West Coast India with coal at $15,250 plus
$152,500 bb, while Famiglia (63,425-dwt, 2023) fixed delivery Haldia 3/5 December for a trip via Port Elizabeth redelivery China at
$11,500.
In the Atlantic Ocean, the Mediterranean was still under pressure. Southport Eagle (63,301- dwt, 2013) fixed delivery Damietta prompt for a trip redelivery Continent with fertiliser at $8,250 to Ultrabulk. New Liulinhai (55,676-dwt, 2004) was covered delivery Oran prompt for a trip redelivery Barranquilla with clinker at $7,000 to Pangea.
A flat week for the Handies across both basins, The BHSI closed today at $11,588
down $277 from last week. The Continent was quiet but showed signs of picking up before Christmas. Frida Bulker (40,161-dwt, 2023) open ARAG fixed delivery Antwerp for a trip redelivery US East coast with steels at
$13,250. Cetus fixed Uniglobe (34,735-dwt, 2013) open Lisbon delivery Rouen to Cartegena with grains at $12,000.
The Mediterranean was very quiet and softening with rates still in four figures for most directions. Four Otello (34,357-dwt, 2010) open Valetta fixed delivery Barcelona redelivery Gdansk with rock salt at $7,750.
The US Gulf had plenty of reported activity, although rates seem to be softening. Lauritzen fixed Sopot (39,035-dwt, 2019) delivery Panama City for a trip redelivery Continent with pellets at $12,500. The highlight fixture was An Ding Hai (38,801-dwt, 2017) that fixed delivery US Gulf for a trip to Morocco at $17,000 with TMC.
The South Atlantic was steady, Lago Di Cancano (37,666-dwt, 2014) in ballast was heard fixed delivery Santos for a trip to
Casablanca at $14,250 with Raizen. PVT Gloria (35,697-dwt, 2011) open Rio Grande fixed delivery Recalada for a trip redelivery West Coast South America at $18,000 to Cargill.
The same story was seen for the Handysize Pacific markets with little fixing activity and sentiment generally maintaining a soft tone.
Despite a gradual increase in tonnage, limited fresh cargo demand prevented rates from rising substantially, although there seemed to be a slight increase in fresh enquiries from Australia.
In the Far East, a 37,000-dwt open South Korea was fixed at high $11,000’s for a trip to West Coast India.
A 33,000-dwt open Japan fixed at around
$11,000 to Thailand, while a 28,000-dwt also open Japan fixed around low $8,000’s to Indonesia.
In South East Asia, a 28,000-dwt open Campha was heard fixed at around $12,000
to East coast India, and a 37,000-dwt open South-East Australia was heard fixed at
$16,000 for a trip to the Far East.
Dry Bulk S&P
The freight and second-hand markets are roped together like a couple of mountaineers.
As the freight market has lost its footing and clattered down the glacier, it was inevitable that it would drag the secondhand market after it.
There are a couple of sales and on-going negotiations this week that suggest the second-hand market has managed to jam its ice-axe into the slope but while there may be some comfort that the fall is not accelerating, a lot depends on the freight market, dangling below, quickly regaining its footholds.
Since August the middle-aged Kamsarmaxes have lost about 25% of their value. For the moment, this concession in price has satisfied buyers who are now competing at last done prices. Twinkle Island (82,265-dwt, 2012 Tsuneishi) invited offers this week and again a good range of buyers bid, despite her April- May 2025 laycan.
We are waiting for the smoke to clear, but some are reporting that the battle for her has moved to or above the $19m level which would suggest that the market is ready to pay better than last done.
| No such enthusiasm is showing for the older |
| tonnage. The Chinese built Stratton (74,403- |
| dwt, 2004 Hudong), with imminent surveys, |
| is reported sold at just $7.1m – close to a |
| 40% decline in value over the last six |
| months and just a million or so above |
scrap.
Dolphin57’s clearly have found a ledge to sit on. Turnover has been brisk in recent months and there is little sign of any further descent in values for the moment. We report the sale this
week of Porthos (56,825-dwt, 2010 Hantong) at a better-than-benchmark $13.2m.
Likewise older Handies are holding on.
Team Samba (31,700-dwt, 2005 Saiki) is sold at a last done $9.3m.
Finally 2024’s appetite for Capesize tonnage continues. The Korean controlled K. Confidence and K. Victory (181,500-dwt, 2013 & 2012) are reported sold at $34.5m and
$33.5m respectively, which given they are scrubber-fitted suggests a small slip in value.
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