The capesize market lost all its gains last week and continued its decline despite a strong finish to the week. The BCI 182 5TC index fell from an opening level of $2,796 on Monday, although it improved by $296 on Friday, ultimately reaching $45,731. Market sentiment weakened across all key regions, with weakness evident in both the Atlantic and Pacific early in the week as cargo availability continued, especially in the east.
Analysis of the Brazil to Qingdao Route
Activities on the Brazil to Qingdao route remained relatively limited, with the loading window fully shifted to the second half of October. The C3 index dropped from $40,659 to $37,675, equivalent to an approximate revenue of $41,814 for a round trip from China/Brazil or West Africa. In the Pacific, new activities emerged mid-week on the route from Western Australia to Qingdao, driven by efforts from operators and miners. Sentiment gradually improved, and the C5 index reached $14,425, achieved after several contracts for loading with slightly later dates.
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Movements in the Atlantic and Pacific
Sentiment in both the Atlantic and Pacific was mixed this week as participants sought clearer direction in the market. In the Atlantic, increased demand from the Gulf of America and a limited position list in Eastern South America provided some support; however, activities were often described as position-based, and bid-ask spreads remained wide. Notable contracts included loading an 81,000 dwt vessel in Gibraltar for a transatlantic trip at $25,000 and another set at $31,000 for delivery basis in Eastern South America.
In the Pacific, sentiment weakened ahead of China's Golden Week holiday, and Indonesian demand remained weak. An 79,000 dwt vessel was loaded from Indonesia to South China at $16,500, and an 82,000 dwt vessel was loaded from Indonesia to South Korea at $20,000. Trade in Australia and the North Pacific continues to make up a significant portion of activities, helping to compensate for weak demand in other regions. A 96,000 dwt vessel was loaded for a round trip in the North Pacific with coal at $20,000, while an 81,000 dwt vessel received $19,000 for a similar trip with grains.
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