Tag: Fertilizer

April 7, 2025

Market Overview:

There was a continuation of post-Liberation Day market trauma, with stock markets starting the week in a tailspin and commodity prices reacting to the changes brought about by U.S. tariffs and countermeasures, particularly China’s. We start the week as we ended last week: a sea of red.

Last week, sentiment in the paper markets (FFAs) significantly pulled back, coupled with a meaningful drop in fuel prices. Eight OPEC+ countries unexpectedly agreed to increase output in May by 411,000 b/d, rather than the previous plan of 135,000 b/d, as part of its plan to gradually unwind previous production cuts. Goldman Sachs cut its estimate for Brent crude’s average price in 2025 by 5.5% to $69 per bbl, citing higher OPEC+ supply and a global trade war weighing on oil demand.

Capes were down to end last week and continue soft to start the new week. Panamax, Supra, and Handy Size continue to be softer, trading in a narrow range to the end of the week/start of the new week.

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March 10, 2025

Market Overview:

Activity in the market remains quiet mainly due to ongoing uncertainty stemming from the US Trade Representative’s recent developments – The US administration has implemented significant trade policies, including a 25% tariff on imports from Mexico and Canada and a doubling of duties on Chinese goods to 20%. These measures have sparked trade wars with major trading partners, leading to retaliatory tariffs from Canada and China. This could have a significant impact on dry bulk trade. The tariffs are expected to alter dry bulk trade flows, with potential shifts in trade routes and demand patterns. Other countries will also seek retaliatory measures. China has announced tariffs on various commodities, which will likely impact US exports and dry bulk shipping volumes overall. The dry bulk market is facing uncertainty due to these geopolitical developments. The long-term effects on trade flows and shipping demand will need to be closely monitored.

The SHIPS for America Act and recent USTR proposals are drawing significant attention in the US maritime sector. The SHIPS Act, described as the largest maritime legislation since the Great Depression, aims to bolster the domestic maritime industry. Meanwhile, the USTR’s proposal to impose a service fee on Chinese-built or managed vessels calling at US ports is expected to face legal challenges. The SHIPS Act also proposes creating a Maritime Security Trust Fund to support US shipbuilding, funded by duties and tariffs collected by Customs and Border Protection. Industry stakeholders are closely monitoring these developments, with key hearings scheduled for March 24.

We will continue to keep you posted on these developments.

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February 10, 2025

Market Overview:

Market Overview:
It’s been a slow start to the week, with Capes trading off, Panamax sentiment mixed as demand disappoints, Supra’s looking up nearby as prompt vessels were covered last week, and Handy’s appearing positive, albeit in a narrow trading range.

Trade Tariffs? A return to 2018/2019 or more of an escalation this time? Until this week, there has been a lot of noise, but so far, there have been limited tariffs and focused retaliation. Now, teased on Sunday and announced on Monday, it is said to be 25% on all Steel and all Aluminum (redux 2018). It’s hard to plan around this stuff yet.

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January 7, 2025

Market Overview:

An expected slow start to the week as market participants return to the office after an extended holiday break and today’s Epiphany holiday.

Our market showed some small signs of life during the break; remaining shipments and vessel delays necessitated some spot-fixing. The downward trend and narrow-range trade continued as we started the new year.

A combination of factors is contributing to the malaise in dry bulk rates in Q4, beyond ongoing China real estate markets/local government debt concerns and current seasonal preholiday lull. The contributing factors are fundamental in nature: normalized Panama Canal transits returning capacity to the market this year, a steady increase in new build vessel arrivals (predominately geared vessels), better port efficiency, and less port congestion generally (noteworthy, in Brazil, less corn demand from China. A double knock-on effect of less congestion and fewer long haul grain stems); intra segment cannibalization of rates (Panamax competing with Capes and in some cases Panamax infiltrating non-traditional commodity markets) – more broadly it’s been about “effective fleet growth.” The rerouting of vessels away from the Suez Canal remains a supportive factor.

Looking forward, after quietly moving through the Christmas and New Year holiday lull, we expect a likely quiet January leading up to the January 29th Chinese Lunar New Year celebration and the largest annual human migration in the world. Then, things start to come back to life in March as the grain trade shifts to the southern hemisphere.

The future developments rely on the impact of recent stimulus in China and the uncertainty of new U.S. administration’s impact on trade, global economics, and geopolitical relations. We expect stability on the demand side in the coming year, save impact of potential sanctions on steel parcel trade and Agri. Considering the fundamental changes on the supply side, we anticipate similar levels on average and increased positional volatility in 2025 due to the more finely balanced supply/demand ratio of our dry bulk market.

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November 20, 2024

Market Overview:
Last week, the capesize market showed improvement with robust activity in both basins, while Panamax, Supra, and Handy size segments traded within a narrow range. Panamax ended the week slightly up, whereas Supra and Handy sizes saw modest declines, with long vessel count lists weighing on all segments. Despite low activity levels in most segments, the Baltic Dry Index rose, driven by increases in capesize vessel rates. China’s coal imports surged by 29% year-on-year in October. Brazil’s grain exporters association, Anec, raised its November export estimates for corn, soybeans, and soymeal, although these projections remain below last year’s figures. The EU’s weekly wheat exports totaled 223,323 tons, a 30% decrease in the new marketing year compared to the previous year. Iron ore prices have been volatile as the market anticipates the impact of China’s recently announced economic stimulus on economic growth, amid concerns of increased iron ore supply, healthy inventory levels, and a slowdown in steelmaking at Chinese mills.

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October 21, 2024

Market Overview:
Hope springs eternal for a so far unrealized seasonal improvement in dry bulk rates. Capes and Panamax have had an uninspiring week. Supra and Handy size have seen pockets of improved rates and a fair bit of positional volatility. Period activity at firm levels and moderate improvements across the forward assessments for Forward Freight Agreement contracts allow market participants to hope for improvement in the coming weeks. We remain cautiously optimistic due to stable demand and supportive supply-side fundamentals.

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September 18, 2024

Market Overview:
We start the week on a positive note, while last week, all markets traded down, each within a very narrow range.

Broker Team Estimates and Historical Data:
Please refer to the chart below, which illustrates our broker team estimates for commodity-specific trade lanes and the historical range they have traded in the past year.

Market Outlook:
The market is more optimistic this week, with the expectation of a lowering of interest rates in America.

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