Harvey's Impact on Handysize Market
THE continuing fallout from Hurricane Harvey has strengthened the handysize bulker market last week, due to longer waiting times and tight tonnage at US Gulf ports.
According to MANA, average weighted time charter rates on the Baltic Exchange climbed to $7,115 per day, the highest level in a month, while the Baltic Handysize Index rose 2.5% in the week to close at 486 points on Friday.
Although ports and terminals in the US Gulf are slowly attempting to restore operations after being hit by the worst storm in years, shipments from Houston, a major port for exporting of wheat, remain halted.
Restrictions for Houston port remain in place, limiting the draft of vessels calling at the port, said a grain analyst. “There will be no (wheat) loading done for at least another few days and maybe longer than that.”
But Hurricane Harvey’s effects on the Texas coast are likely to be long-lasting and turbulent, affecting freight rates in the long term.
Devastating rains are expected to continue through most of the week, with soyabean traders now monitoring the direction of the rains.
If the rain moves east and north from Texas to the Mississippi Delta region, a lot of soyabean crops could be damaged, which will in turn hamper handysize and supramax shipments.
Harvey has created uncertainty over the direction the US Gulf will take, said Hartland Shipping in a report, adding that rumours of up to half a million tonnes of petcoke being swept off the quayside at Houston and Port Arthur suggest rates may come off aggressively.
The HS6 route, South Korea-Japan trip via North Pacific to Singapore-Japan, registered a 3.6% increase week on week and HS3 route, or Rio de Janeiro-Recalada trip to Skaw-Passero, settled at $9,136 per day on Friday, up 2% over the week.
Spot markets remained in a lull, with only a handful of fixtures reported during the week.
In the Atlantic, a 2011-built, 36,800 dwt vessel was fixed for a trip to Far East in the mid-$13,000s and from north coast South America a 2012-built, 34,000 dwt vessel was concluded in the mid to upper $7,000s for a trip to Morocco, the exchange noted.
The asset market remains quiet,with no new deals reported in the newbuilding or secondhand market.