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October 9, 2008

Bulk Carriers: From $91,000/Day to Zero in Five Months Flat

Fairly astounding data nugget on the collapse in daily rates charged by bulk shipping carriers:

UNCONFIRMED reports a panamax was fixed for a voyage that covered bunkers and port costs only stunned London brokers today, as bulk carrier charter rates continued their month-long freefall.

The fixture, yet to be verified by the Baltic Exchange, was rumoured to be for a 1981-built panamax coming out of the Middle East Gulf for a journey via the west coast of India, to take a cargo of iron ore to China.

If true, the deal represents an amazing turnaround for panamax charter rates, which have plunged from over $50,000 per day in late August.

The charter arrangement for the elderly vessel represents an effective rate of “zero dollars per day” and plunges the industry back to its darkest times in the early to mid 1980s.

... Panamax average time charter rates hit a high of nearly $95,000 per day on October 30 last year. But the rate was still as high as $91,000 per day in late May, when China’s reccord-breaking appetite for iron ore from Brazil and Australia saw demand for bulk carriers outstrip supply.

More here.

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