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S h i p p i n g M o n t h l y R e p o r t – S e p t e m b e r 2 0 1 1
• The Baltic Dry Index (BDI) increased by 28% to 1619 in August
2011 due to a 49%, 8%, and 10% rise in Capesize, Panamax and
Supramax index, respectively. Freight rates rose in August for
Capesize vessels as there was a significant revival in Australian
coal exports that led to firmness in freight rates. Also, there was a
strong upturn in Chinese imports of nickel ore and ferrous scrap
that resulted in higher freight rates even for smaller vessels. We
expect freight rates to firm up further particularly for Capesize
vessels as lower iron ore exports from India would be
compensated by long hauls from Brazil to Asia, which should
support freight rates for Capesize vessels
• The Dirty Tanker Index declined by 6% to 679 while the Clean
Tanker Index increased by 1% to 688 level in August 2011. VLCC
freight rates remained in the negative territory while day rates for
Suezmax rose by 46% (on an abnormally low base) and Aframax
freight rates rose by 10%
• LPG freight rates displayed a steady to firm trend in August 2011
with VLGCs day rates registering a sharp up move of 10% while
MGCs were in the range of 1-7% with a positive bias
• Utilisation levels for drill ships, semi-subs and jack-ups displayed a
mixed trend. Utilisation levels for drill ships, semi-subs and jackup rigs was reported at 79%, 87% and 79% in August 2011 as
against 77%, 87% and 81% in July 2011.
Outlook
Dry bulkers
In the near term, dry bulk freight rates are expected to remain positive
owing to the revival of Australian coal exports and higher imports of
nickel and ferrous scrap by China. Also, to compensate, the shortfall of
Indian iron ore exports, long hauls from Brazil to Asia would support the
freight rates, particularly, for Capesize vessels. Over the longer term,
excess supply of tonnage would keep tabs on the up move in freight
rates.
Tankers
Crude oil tanker freight rates are expected to remain subdued owing to
the oversupply of tonnage, which would handicap the market. Even if
some demand emerges in the near term, the tonnage available is likely to
weigh on the charter rates and keep them subdued. Some positive
momentum is likely for VLCCs while Suezmax day rates are expected to
rise from its current appalling levels.
LPG carriers
LPG freight rates are expected to remain range-bound with a positive bias.
However, smaller vessels may face downward pressure in freight rates
due to large proportion of vessels to be added to the global fleet in 2011.
Offshore vessels
Utilisation levels for offshore vessels are expected to rise while charter
rates are expected to remain stable in August 2011. High capex spend by
major global oil exploration/drilling companies is likely to lead to higher
utilisation levels for offshore vessels.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
S h i p p i n g M o n t h l y R e p o r t – S e p t e m b e r 2 0 1 1
• The Baltic Dry Index (BDI) increased by 28% to 1619 in August
2011 due to a 49%, 8%, and 10% rise in Capesize, Panamax and
Supramax index, respectively. Freight rates rose in August for
Capesize vessels as there was a significant revival in Australian
coal exports that led to firmness in freight rates. Also, there was a
strong upturn in Chinese imports of nickel ore and ferrous scrap
that resulted in higher freight rates even for smaller vessels. We
expect freight rates to firm up further particularly for Capesize
vessels as lower iron ore exports from India would be
compensated by long hauls from Brazil to Asia, which should
support freight rates for Capesize vessels
• The Dirty Tanker Index declined by 6% to 679 while the Clean
Tanker Index increased by 1% to 688 level in August 2011. VLCC
freight rates remained in the negative territory while day rates for
Suezmax rose by 46% (on an abnormally low base) and Aframax
freight rates rose by 10%
• LPG freight rates displayed a steady to firm trend in August 2011
with VLGCs day rates registering a sharp up move of 10% while
MGCs were in the range of 1-7% with a positive bias
• Utilisation levels for drill ships, semi-subs and jack-ups displayed a
mixed trend. Utilisation levels for drill ships, semi-subs and jackup rigs was reported at 79%, 87% and 79% in August 2011 as
against 77%, 87% and 81% in July 2011.
Outlook
Dry bulkers
In the near term, dry bulk freight rates are expected to remain positive
owing to the revival of Australian coal exports and higher imports of
nickel and ferrous scrap by China. Also, to compensate, the shortfall of
Indian iron ore exports, long hauls from Brazil to Asia would support the
freight rates, particularly, for Capesize vessels. Over the longer term,
excess supply of tonnage would keep tabs on the up move in freight
rates.
Tankers
Crude oil tanker freight rates are expected to remain subdued owing to
the oversupply of tonnage, which would handicap the market. Even if
some demand emerges in the near term, the tonnage available is likely to
weigh on the charter rates and keep them subdued. Some positive
momentum is likely for VLCCs while Suezmax day rates are expected to
rise from its current appalling levels.
LPG carriers
LPG freight rates are expected to remain range-bound with a positive bias.
However, smaller vessels may face downward pressure in freight rates
due to large proportion of vessels to be added to the global fleet in 2011.
Offshore vessels
Utilisation levels for offshore vessels are expected to rise while charter
rates are expected to remain stable in August 2011. High capex spend by
major global oil exploration/drilling companies is likely to lead to higher
utilisation levels for offshore vessels.
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