MID-SHIP Report: Dry Bulk Freight Market – January 14, 2026

January 14, 2026

Welcome to 2026!!

While we have a new number to put into all our emails, the start of 2026 feels a lot like early 2025 when it comes to government actions and macroeconomic policies raising a palpable level of uncertainty in the freight market. Last year’s wave of trade-related initiatives, rolled out by the United States (answered to varying degrees by other nations), continued pressure on trade via the Red Sea, and USTR implementation created inefficiencies in a market that should have been in decline, but resulted in a solid market appreciation for many market segments during the year. This year’s start, with the backdrop of action in Venezuela (and the impact on continued sanctions), upheaval in Iran and fresh comments on broader trade policy shifts including a 25% U.S. tariff on countries trading with Iran and further tariff action against China, may again cause disruption to what many had expected would be a quieter year, with a continued slow downward correction. Fuel markets are also on edge and oil prices have rallied. Further action in the Mideast/Iran could have dramatic effects on forward pricing, which had been relatively level to this point.

Over the past 2 months, we have seen the market ease in all primary segments and as thinning demand and new vessel arrivals created a soft landing for 2025. Cape pricing for front-haul, using the Baltic Capesize Index 5TC as a benchmark, fell from about USD 27,600/day to USD 23,000/day over this period. The general index for Handy-sized ships likewise softened, with the Baltic Handysize Index declining from roughly 820 points in early November 2025 to about 600 points in mid-January 2026, though there have been pockets of strength in the Atlantic and in SE Asia – the latter influenced by higher steel exports from China (and resulting congestion) to end the year.

It is still too early to say what direction we will see the broader market take this year. The Cape and Panamax segments have eased over the past few weeks, but there is a sight of stabilization/correction in the coming months – a lot will balance on whether China looks to rebuild iron ore stocks after the Lunar holidays next month. The Handy and Ultramax segments continue to see tight supply in certain markets, buoying pricing for the time being. If painted with a broad stroke, given the high level of fleet replacement we have had and will continue into this year, coupled with relatively flat demand indicators, we should be seeing a continuing easing in the general market. However, the “outside” elements of military action, social unrest, and trade policy still have the ability to affect that expectation over the coming months.

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