Dry Weekly Market Monitor - Week 05, 2025
Snapshot of Spot Freight Rates, Supply-Demand Trends, Port Congestions
January 29, 2025
Chart of the Week: Capesize Market Insights
This week's highlight delves into the evolving dynamics of Capesize tonne-day growth from Brazil to China, alongside the performance of the Baltic Capesize Index and Tubarão-to-Qingdao market rates. Notably, the recent decline in freight rates following the Chinese New Year has influenced laden speeds, while the number of Capesize ballasters in the South Atlantic surged towards the end of January.
The momentum in the freight market has weakened as we approached the end of January and the onset of the Chinese New Year. The prevailing oversupply situation continues to significantly pressure market sentiment, compounded by a decline in demand for tonne-day growth. In the Capesize segment, we have observed a clear downward trend in tonne-day growth for shipments from Brazil to China, with the performance of the BCI (Baltic Capesize Index) dropping nearly 50% compared to the levels recorded at the same time last year.
As the freight market continues to soften, Capesize laden speeds have fallen to a historic low over the past 12 months, reflecting further stress within the segment. At the same time, the number of Capesize vessels acting as ballasters in the South Atlantic has surged to a record high, surpassing 240 vessels—marking the highest level seen in the past year. This is further underscored by C3 market rates, which have plunged to a record low of $17 per tonne.Looking ahead, the next few weeks will be crucial in determining the direction of the market. The volume of vessel ballasters and the potential growth in demand over the coming four weeks will play a critical role in shaping the overall sentiment of the dry bulk freight market.
Meanwhile, when it comes to iron ore supply, output levels from major producer Vale appear unaffected by the fragile Chinese economic environment. Vale reported this week that its annual iron ore production in 2024 reached its highest level since 2018, despite a decline in Q4 output. The company attributed its strong full-year performance to greater operational stability and the successful launch of key projects. For the full year, Vale's iron ore production rose 2% year-on-year, reaching nearly 328 million metric tons in 2024, and the company has projected 2025 production to range between 325 million and 335 million tons.
The dry bulk freight market experienced a weakening momentum at the end of January; however, recent sentiment in the freight market remained stronger than at the end of the previous year, despite the Chinese New Year holidays.
Capesize vessel freight rates for shipments from Brazil to North China have stabilized around $17 per ton, reflecting a 5% decline from the previous month and a 22% drop compared to the same period last year.
Panamax vessel freight rates from the Continent to the Far East dropped below $29 per ton, showing a 30% decline compared to the same period last year.
Supramax vessel freight rates on the Indo-ECI route remained below $7 per ton, marking a 20% decrease from the previous month.
Handysize freight rates for the NOPAC Far East route have fallen to $25 per ton, representing a 16% month-on-month decline.
The market saw a significant rise in the number of ballasters, surpassing the annual average for the larger vessel size categories.
Capesize SE Africa: The number of vessels exceeded 130, 15 above the annual average, signaling a spike with the onset of the Chinese New Year season.
Panamax SE Africa: The end of the month confirmed the uptick seen in the previous week, with levels reaching around 180—nearly 50 above the annual average.
Supramax SE Asia: There has been a significant increase, with numbers consistently trending above the annual average of 100.
Handysize NOPAC: An upward trend above the annual average persisted; however, a downward correction occurred, bringing the figure to 90, which is 8 higher than the previous week.
The end of January confirmed a downward trend in dry tonne-day growth across all dry vessel size categories. However, the pace of demand recovery remains uncertain and will depend on market dynamics following the Chinese New Year celebrations.
Capesize: A significant decline has brought the current growth rate to record lows, compared to the peak at the beginning of the year.
Panamax: Tonne-day growth has mirrored the recent decline in Capesize ton-miles, reaching one of its lowest levels for January. The weakening trend is expected to continue in the coming days.
Supramax: The growth rate remains stronger than in other vessel size categories, despite a continued decline from the highs reached two weeks ago.
Handysize: The Handysize vessel segment has continued its downward trend from previous weeks throughout January, with its latest growth rate now aligning with that of the Panamax segment.
Congestion at Chinese dry bulk ports saw a significant reduction at the end of January, with declining trends observed in the Supramax and Panamax vessel size segments.
Capesize: Capesize vessel congestion remained stable at approximately 120.
Panamax: The number of Panamax vessels continued below 200, dropped to 160, reflecting a surprising decrease of 30 compared to the figures recorded during the fourth week of January.
Supramax: Congestion levels dropped below 270 vessels, almost 30 lower compared to the figures recorded in the previous week of January.
Handysize: Congestion levels fell to 190, down by 9 from the previous week, remaining below the 200 mark since week 43 of the previous yea
Data Source: Signal Ocean Platform