Freight rates for capesize face mixed prospects next week

Freight rates for capesize bulk carriers face mixed prospects next week as uncertain cargo demand from China after the Golden Week holiday potentially weighs on freight rates, while tighter tonnage supply could arrest the current decline in rates, ship brokers said. "Rates are still sliding down," said a Shanghai-based capesize broker on Thursday.
"We're seeing some iron ore cargo from Western Australia. But there is not much coal. The feeling is still not that good," the broker said. "But I also don't see many vessels available," the broker added. An uptick in cargo volumes coupled with limited vessel capacity could prompt a bounce in rates, the Shanghai broker indicated.
Capesize rates are their lowest since mid-September, Reuters freight data showed. While Thursday was officially the first day back at work after China's Golden Week holiday, people were taking extra leave so Chinese chartering activity is not expected to fully resume until Monday, the Shanghai broker said. "I think this week is over," a rival Singapore capesize broker said, commenting on the low level of fixing activity on Thursday.
"Rates are a little bit softer across all routes. Hopefully it will pick up next week," the Singapore broker added. Shipping executives are anticipating a stronger rebound in freight rates next month as China restocks but there is uncertainty how high rates will climb. "Most people agree a spike in rates will happen, the question is when, how long it will last and how substantial the improvement in rates will be," Norwegian ship broker Fearnley said in a note on Wednesday. "The quarter four push (in rates) should come to fruition. Whereas it should really by starting in October or early November, it's likely to come mid to end November," a Singapore panamax broker told Reuters on Thursday.
Charter rates for the Western Australia-China route were around $5.70 per tonne on Wednesday, against $5.87 a tonne a week ago, with charter pushing rates lower to $5.50 a tonne on Thursday, brokers said. Rates for the Brazil-China route were down to $12.10 on Wednesday compared with $13.13 per tonne a week earlier, with charter offering rates below $12 per tonne on Thursday, the Shanghai broker said.
Panamax rates for a north Pacific round-trip voyage nudged higher to $6,275 per day on Wednesday up from $6,141 per tonne the same day last week. "North Pacific business is quieter, but the market feels pretty good," the Singapore panamax broker said. Freight rates for smaller supramax vessels were flat this week on reduced chartering activity from China, the Fearnley note said. The Baltic Exchange's main sea freight index fell to 841 on Wednesday, down from 900 last week.