The Baltic Exchange’s main dry bulk freight benchmark declined to its lowest level in almost a week on Monday, as weaker rates for capesize and panamax vessels weighed on the market. Hellenic Shipping News, carrying a report credited to Investing.com, said the headline index lost 32 points, or 1.23%, to finish at 2,628 points. The measure covers shipping rates across the capesize, panamax and supramax vessel categories.
The capesize index fell by 65 points, or 1.71%, to 3,726 points, also marking a low for nearly a week. Average daily earnings for vessels in that segment dropped by $585 to $30,292, according to the report. Capesize ships generally transport cargoes of about 150,000 tonnes of iron ore and coal, placing those commodity trades at the centre of the segment’s activity.
The decline in capesize freight rates came as iron ore prices moved within a narrow band on Monday. Traders were weighing the prospect of seasonally softer demand in China against the possibility that Beijing would introduce further measures to stimulate the economy. The report described those competing expectations as the backdrop to the limited movement in iron ore prices, rather than pointing to a clear direction for the commodity.
China is the world’s largest consumer of iron ore and its second-largest economy, making both its demand outlook and the prospect of policy support relevant to the market described in the report. Expectations of seasonal demand weakness were therefore being assessed alongside the potential for additional stimulus, with neither consideration producing a broad price move on Monday.
Panamax rates also weakened. The segment’s index shed 34 points, or 1.61%, to 2,075 points, its lowest reading since July 30. That placed the panamax measure at a longer-period low than either the overall Baltic benchmark or the capesize index.