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Asia Dry Bulk-Capesize rates to climb on bad weather delays, more cargo

Published 2016-07-07, 04:39 a/m
Asia Dry Bulk-Capesize rates to climb on bad weather delays, more cargo
BHP
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FMG
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RIO
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RIO
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BADI
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* Brazil-China rates hit seven-month high on thin tonnage
numbers
* Typhoon Nepartak likely to cause delays, disrupt sailing
schedule - brokers

By Keith Wallis
SINGAPORE, July 7 (Reuters) - Freight rates for large
capesize dry cargo ships on key Asian routes could move higher
next week on a potential ship shortage, higher cargo volumes and
storms in China that could disrupt sailing schedules leading
charterers to scramble to fix replacement tonnage, ship brokers
said.
"We do not have a lot of ships available off Brazil to load
cargo at the end of July. That will likely support freight
rates," said a Shanghai-based capesize broker.
That came as capesize rates from Brazil to China hit a
seven-month high on July 4.
"Hopefully, rates will climb up to near $10 a tonne," the
broker added.
The Big Three Australian miners - Rio Tinto (LON:RIO) RIO.AX , BHP
Billiton BHP.AX and Fortescue Metals Group FMG.AX - have
largely been absent from the spot-chartering market this week
after freight rates climbed to a three-week high on Monday,
although they have subsequently slipped.
"When the market is hot, miners are always inclined to wait
for rates to fall," the broker said.
That has fuelled sentiment that miners will return to the
market next week with a raft of new cargo requirements.
Bad weather in China during the weekend caused by super
typhoon Nepartak is likely to cause port congestion and
unloading delays, which would affect vessels while they try to
fulfill their next charter. That would force charterers to pay
higher rates to fix alternative vessels, brokers said.
"Right now the market is falling, but it will be a bit
firmer next week. The typhoon will create delays," said a
Singapore-based capesize broker.
"We should see rates pick-up next week," the Singapore
broker said.
Capesize charter rates for Western Australia-China .BAWB
climbed to $4.63 per tonne on Wednesday, up from $4.51 per tonne
last week. Rates rose to $4.78 per tonne on July 4, the highest
since June 15.
Freight rates from Brazil to China .BATB hit $9.49 per
tonne on Wednesday compared with $9.37 per tonne the previous
week. They soared to $9.71 per tonne on July 4, the highest
since Dec. 2.
Charter rates for smaller panamax vessels for a north
Pacific round-trip voyage .BPHJ jumped to $5,822 per day on
Wednesday, from $5,153 per day on the same day last week.
There was stronger sentiment this week on all panamax routes
with firm rates on Asian trades, Norwegian ship broker Fearnley
said in a note on Wednesday.
Freight rates in the Far East for smaller supramax vessels
held steady on positive sentiment, brokers said.
The Baltic Exchange's main sea freight index .BADI rose to
694 on Wednesday from 640 last week.

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