Helped by demand to transport new crops from South America, Asian shipping rates are keeping their bullish trend this week but gains were limited as the market heads into the Easter holiday, brokers said. Spot voyage fixtures for modern panamax rates for the benchmark US Gulf-to-Japan route were quoted around $61-$63 per tonne, down from $62-$64 a week earlier. The benchmark rate was supported by the uptrend in the Europe-and-East route, which began last week. "The Atlantic market is strong and the Gulf-Japan route is catching up," said a spot broker at a Japanese shipping company.
"We are not in a tight market situation now but we are likely to see stronger demand with more newly harvested South American crops expected to move into the market."
The market is still expecting a good harvest in South America despite reports of dry weather in Brazil that have led forecasters to lower production estimates, brokers said.
For example, the lowest estimates for the Brazilian soybean crop were running between 51-52 million tonnes compared with the USDA's estimate of 59 million tonnes.
Brokers said, however, they were unsure whether the underlying bull trend would continue in the near term.
"Rates started to recover late last week from the falls seen in the early part of the week," a Seoul broker said. "But the rise is unlikely to be supported much due to the Easter holidays mood this week without many fixtures."
Many markets across the world will be closed on Friday for the Good Friday holiday.
The US Gulf-Japan route was also supported by demand for charters by China, brokers said.
"We are not hearing that Chinese charterers are active now, but I think there is constant demand from the country, making rates very solid," another Tokyo broker said.
Time-charter rates for the benchmark US Gulf-to-Japan route were quoted at $41,000-$42,000 a day plus $730,000 ballast bonus compared with around $44,000-$45,000 a week earlier, brokers in Tokyo and Seoul said.
The rate for the Pacific market was $38,000-$39,000 a day versus about $40,000 last week.
The rate for the Europe-to-East Asia route was firmer at $49,000 a day from around $44,000-$45,000 last week.
"While demand for US Gulf grains fell sharply, demand for South American grains has become more active, accordingly raising the difference in the freight rates between the two areas," the Seoul broker said.