The resumption of iron ore shipments from Australia and Brazil and the return to full productivity of Chinese steel mills are having a positive impact on the dry bulk market.
The market analysis company Braemar ACM retraces the dynamics of the last few days in its latest weekly report. The consultancy firm said that China was getting every ton of iron ore available, pointing out that in May Beijing produced 92.3 million tons of steel.
Meanwhile, shipments from Brazil have resumed at the rate of 1 million tons per day, with an average growth rate of +21% compared to May. The most immediate consequence is that the demand for Capesize bulkers (with a capacity of about 180,000 dwt) has increased. Freight rates for this type of ship have skyrocketed: on the C3 route, which connects Tubarao (Brazil) to Qingdao (China), they have been up by 163%, to 21.71 dollars per tonne.
Freight rates between Australia and China have also risen by 132% to $9.74 per tonne. Apparently, the demand for Capesize bulkers is driven by the country where kangaroos come from, where some producers have tried to maximize sales before the end of the tax year, anticipating the scheduled orders for July.
In June, Australia’s main mines shipped 78.7 million tonnes of iron ore, 6% more than in May.
Translation by Giles Foster