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Baltic index logs best day in eight months

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Dry Bulk,

Reuters has reported how the Baltic Exchange’s main sea freight index posted its biggest percentage jump in eight months on 5 March 2020, boosted by stronger rates across vessel segments.

The Baltic index, which tracks rates for capesize, panamax and supramax vessels that ferry dry bulk commodities, jumped 37 points (6.6%) to 599, its biggest daily percentage gain since 4 July 2019.

Randy Giveans, Senior Vice President of equity research at Jefferies, said: “The market has started to improve as the supply/demand balance is tightening […] We certainly expect demand and rates (for capesize) to improve in the coming months.”

The capesize index rose 46 points to -307. Average daily earnings for capsizes, which typically transport 170 000 – 180 000 t cargoes including iron ore and coal, rose by US$285 to US$2515.

Giveans added: “On the demand side, China is starting to stimulate and return to work, so that is certainly driving incremental cargoes. On the supply side, vessels continue to slow down and older ships are being scrapped.”

Shipping demand from China has been subdued as the coronavirus outbreak has forced authorities to shut factories and mills.

The panamax index climbed 65 points (6.8%) to 1026, its highest since 24 December 2019.

The index registered its 21st straight session of gains.

Average daily earnings for panamaxes, which usually carry coal or grain cargoes of about 60 000 – 70 000 t, gained US$580 to US$9231.

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