March 2019

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12-March-2019

Capesize dry bulk carrier freight rates have plummeted below operating costs of $5,000 per day last week. Capesize dry bulk carrier owners are planning to idle their vessels because of the weak capesize dry bulk freight market. Experienced shipping market veterans believe that capesize market has bottomed out and is set for a rebound. Capesize dry bulk carrier freight rates can’t go much lower before ship owners start idling vessels. Capesize dry bulk carrier freight rates reached bottom and that an upturn should materialize very shortly. Capesize to panamax dry bulk market ratio is now is the lowest level since early 2016. Previously, when capesize dry bulk carrier freight rate was at such low levels, market rebound followed. Current capesize dry bulk carrier freight rate weakness represents the intra-year low for 2019, and forecast the Baltic Dry Index to average around 125% higher in Q2 2019. Currently, capesize dry bulk carrier freight rate costs around 40% less to hire a vessel and having 125% more cargo capacity. Soon, panamax dry bulk charterers to pool cargoes into capesize dry bulk carriers. United States – China trade negotiations are expected in late March could also trigger a rally in dry bulk rates. Capesize dry bulk operators are turning towards slow steaming amid the weak earnings. Capesize dry bulk carriers’ optimal speed for was lower at 11 knots at the beginning of 2019.