Dry Weekly Market Monitor - Week 17, 2025
Snapshot of Spot Freight Rates, Supply-Demand Trends, Port Congestions
April 23, 2025
The first quarter of 2025 has shown mixed signals in China's dry bulk import profile, reflecting commodity-specific trends and the broader strategic shifts underway amid the U.S.-China trade war. The above charts reveal YoY volume comparisons for March 2025 vs. March 2024, highlighting divergent patterns in iron ore, coal, and grain flows to China.
Iron Ore from Brazil to China: +20.89% YoY (Mar25 vs Mar24)
The significant increase in iron ore imports from Brazil aligns with China's intensified urban renewal initiatives. According to the Chinese Ministry of Finance, the central government will continue to support urban renewal projects in 2025, focusing on addressing pressing concerns of the people and driving high-quality urban development. These projects, particularly in mega and super-large cities along key river basins, are expected to boost demand for construction materials, including steel, thereby increasing iron ore imports. Increased volumes from Brazil also underscore a preference for long-haul Capesize shipments, boosting tonne-mile demand and providing upward support to freight rates on routes like C3 (Brazil-China).
Coal from Indonesia to China: -18.35% YoY (Mar25 vs Mar24)
Coal flows present a markedly different narrative. The 18.35% year-over-year decline likely reflects a mix of tightening environmental regulations, volatile power sector demand in China, and evolving geopolitical dynamics. Notably, Indonesia has been deepening trade ties with the U.S. and India. While coal hasn't been directly targeted in the ongoing trade war, the realignment of global alliances may indirectly influence China’s import preferences.
In the first quarter of 2025, coal-fired electricity generation in China fell by around 4.7% year-over-year, despite a 1% increase in overall electricity demand. High domestic coal inventories and a drop in March imports suggest a pivot toward local sourcing, especially as domestic coal prices have hit four-year lows. Adding to this shift, Indonesia’s implementation of a benchmark coal price has made its exports less competitive in China.
Geopolitical considerations are further influencing these trade patterns. Indonesia’s commitment to boosting U.S. imports by up to $19 billion—including $10 billion in energy products—is part of a broader strategy to reduce its trade surplus with Washington and avoid future tariffs. This rebalancing could come at the expense of exports to China, particularly in the coal sector.
At the same time, China has voiced concerns over nations that appear to be aligning more closely with the U.S., warning of retaliatory measures if its economic interests are undermined. These developments highlight how shifting global alliances are shaping more and more of China's energy import decisions.
Grain from Brazil to China: +35.77% YoY (Mar25 vs Mar24)
Grain imports have soared, highlighting food security as a critical pillar of China's strategic trade calculus. With U.S. grain increasingly weaponized via tariffs and restrictions, China has deepened its agri-commodity trade with Brazil. The 35.77% increase in March aligns with seasonal procurement cycles but is likely amplified by the geopolitical imperative to decouple from American supply chains. This shift benefits the Supramax and Panamax segments engaged in transatlantic grain trade. It also reflects Beijing’s desire to preempt disruptions in a volatile trade environment. It underscores Brazil’s rising role as a key agri-export partner amid a realignment of global trade flows.
Geopolitics Steering Trade Routes
The data reveals a clear shift in China’s commodity sourcing strategy, driven not just by economic and seasonal factors but also by broader strategic realignments amid the ongoing trade war with the U.S. Iron ore and grain imports from Brazil are rising sharply, supporting long-haul dry bulk demand. In contrast, coal imports from Indonesia are falling, signalling a more selective or deliberately redirected approach to procurement.
Sentiment in the Capesize freight market is softening amid a rising number of ballasters, while recent indicators suggest a weakening outlook for the Handy NOPAC Far East market.
Capesize vessel freight rates from Brazil to North China closed below $19 per tonne, showing a 24% decrease compared to last month.
Panamax from the Continent held near $30 per tonne, reflecting a 4% decline month-on-month and a 30% drop year-on-year.
Supramax vessel freight rates on the Indonesia–East Coast India (ECI) route remained steady at around $9 per tonne, registering a modest 1.4% month-on-month decline.
Handysize freight rates for the NOPAC Far East route slipped slightly below $29 per tonne, recording a 9% decline month-on-month.
Recent ballaster indicators highlight sharp increases in Supramax activity across Southeast Asia and Handy vessels in the North Pacific, while Capesize levels in Southeast Africa hold their upward trend.
Capesize, SE Africa: The number of vessels stood 120, remaining above the yearly average of 110.
Panamax SE Africa: The vessel count continued hovering below the annual average of 130 from the end of week 10
Supramax SE Asia: The current trend shows a continuous upward movement starting from the end of week 15. As of now, recent levels have crossed the 100 mark and continue to remain above it.
Handysize NOPAC: The Handy NOPAC segment's levels have increased to 100, continuing an upward trend that began at the end of week 11.
The final week of April was characterised by a slowdown in the growth of tonne-days across all vessel size categories.
Capesize: Since peaking at the end of Week 11, the growth trend has been on a decline, though it appears to have stabilized toward the end of the month.
Panamax: A downward trend has emerged since the peak recorded four weeks ago, though levels remain elevated compared to the softer momentum observed in Week 8.
Supramax: Although the growth rate remained above the low seen in Week 11, a slight downward revision was observed ahead of month-end.
Handysize: Its growth rate has shown a gradual decline in the second half of the month, following a final spike observed in Week 13.
Dry bulk port congestion in China saw a downward revision just days before month-end, following a spike observed the previous week.
Capesize: Capesize vessel congestion declined to around 120 vessels, nearly 20 fewer than at the end of the previous week.
Panamax: Panamax vessel congestion fell below the 200 mark, down by just over 10 vessels compared to the previous week's end.
Supramax: After reaching peak congestion levels two weeks ago, end-of-month figures saw a downward revision to around 320 vessels, a decrease of 15 from the previous week's end.
Handysize: Congestion levels dropped 209, marking a decrease of 9 compared to the end of the previous week.
Data Source: Signal Ocean Platform