• 8 minutes U.S. Shale Oil Debt: Deep the Denial
  • 13 minutes WTI @ $75.75, headed for $64 - 67
  • 16 minutes Trump vs. MbS
  • 27 mins Despite pressure about Khashoggi's Murder: Saudi Arabia Reassures On Oil Supply, Says Will Meet Demand
  • 2 hours Dyson Will Build Its Electric Cars in Singapore
  • 2 hours China Opens Longest Mega-Bridge Linking Hong Kong to Mainland
  • 14 hours Knoema: Crude Oil Price Forecast: 2018, 2019 and Long Term to 2030
  • 24 mins Why I Think Natural Gas is the Logical Future of Energy
  • 4 hours Satellite Moons to Replace Streetlamps?!
  • 4 hours Can “Renewables” Dent the World’s need for Electricity?
  • 29 mins How Long Until We Have Working Nuclear Fusion Reactor?
  • 53 mins These are the world’s most competitive economies: US No. 1
  • 2 hours The Balkans Are Coming Apart at the Seams Again
  • 15 hours EU to Splash Billions on Battery Factories
  • 14 hours Get on Those Bicycles to Save the World
  • 10 hours Merkel Aims To Ward Off Diesel Car Ban In Germany
Alt Text

Did Venezuela Just Default?

S&P Global Ratings declared Venezuela…

Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Trending Discussions

Shipping Rates Continuing to Soar – Could the Chinese be Starting to Unload their Metal Stockpiles

There definitely appears to be something going on with global bulk shipping.

I mentioned last week that shipping rates (as measured by the Baltic Dry Index) for Capesize vessels have been soaring since the end of April.

That trend is continuing. After taking a breather at the end of last week, Capesize rates hit a fresh yearly high today, at $59,324. Up 140% since mid-April.

These rates themselves are not exceptionally high. But what's interesting is that even as Capesize rates are rising, route rates for smaller ships (Panamax and Supramax) are tumbling. Panamax rates fell 4% yesterday alone. And another 2% overnight.

All told, Panamax rates are down 13.6% since May 20. Supramax rates have fallen 7.9% in the same period.

As far as I can tell (without having run any detailed stats), this divergence between Capesize and smaller ships is unprecedented in the last several years. At times, Capesize rates have gone up faster than for the other ships. But it's unusual to have the indexes moved in opposite directions by so much, for so long.

Importantly, Capesize vessels are the "weapon of choice" when it comes to carrying bulk ore. The question is: is more ore sailing because buyers are seeking supply? Or because sellers are looking to unload?

If the rate discrepancy was due to a global dumping of bulk commodities, one of the first suspects would be China. Analysts have long been wondering when large Chinese metals stockpiles might be re-exported. And there were some reports this week of high aluminum exports from Chinese ports.

However, Chinese shipping rates (as reflected in the China Containerized Freight Index) have been more or less steady since the beginning of March. No notable jump that might suggest a mass sailing of ore the last few weeks.

Of course, the Chinese index isn't segmented by ship type, the way the Baltic Dry is. It's possible that increased Capesize sailings in China might be obscured if there was a simultaneous fall in rates for other types of vessels.

All of which means we'll have to look elsewhere for evidence (hard or anecdotal) of increased base metal shipments in order to confirm or disprove this hypothesis. Something to keep in mind as you read the news during the coming weeks.

By. Dave Forest of Notela Resources




Back to homepage

Trending Discussions


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News