Page 35: of Maritime Logistics Professional Magazine (Sep/Oct 2019)

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Capesize strength was due to owners already slowing down their year time charter.

vessel on long ballast voyages back from China. Grindrod’s Mr. Eventually, and depending on how many owners actually opt

Wade chimed in, “If you see the fuel prices going up, I think that for the scrubber route – and that has been a controversial discus- you’ll see ships slowing down quite dramatically.” He explained sion as of late – market rates will no doubt react to the lack of that a slowdown of 1 knot, feet wide, would take approximately availability (or overcapacity) of tonnage, as a result. Hence, the 8% of supply out of the picture, noting the extremely positive markets and associated freight rates fnd themselves once more at impact if such a supply reduction comes on top of the estimated the mercy of governmental policies (trade wars) and regulatory 3% already out of action. (IMO 2020) pressures. And, it’s entirely possible that one vari- able could cancel out the other. Or, not.

Different Ships; Different Long Splices Throw in the unexpected Black Swan event and even the best

Differing viewpoints are what makes a market. For example, of projections can be dashed in a New York minute. There are as and in a late September report on the derivatives market for Cape- many opinions as there are variables in this market, something size freight, brokers Freight Investor Services told clients were that’s always made this a segment not for the faint of heart. One that the “Calendar 2020” forward freight agreement (FFA) instru- thing is for sure: it will remain that way in the coming months. ment – refecting investors’ collective views of Capesize hires throughout 2020 – was priced a little above $16,000/day. Broker

Fearnleys noted in their early October weekly report that the Bal- tic Dry Index had dipped to just over 1800, with one year physi- cal time charters of Capesizes worth $19,750/day and Panamaxes garnering $14,000/day. Importantly, the forward fnancial and

Barry Parker

The Author physical markers were both below the early October spot indices

Parker of bdp1 Consulting Ltd provides strategic and tactical support, including analytics and communications, from the Baltic Exchange, which stood at $23,675/day for Capes. to businesses across the maritime spectrum. The company

The Panamax showed a fat forward curve, with the spot Baltic can be found online at www.conconnect.com

Exchange marker at $13,868/day, virtually identical to the one

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