The Sea/analytics May Report

24 May 2022

The Sea/analytics Team are back with their May report

The Sea/analytics May Report

The Sea/analytics team are back with their May report. Find out more about the introduction of Dr. Copper within the dashboard, the increase in Brazilian iron-ore exports and the impact that soaring natural gas prices have had on the shipping industry.

The Capesize market crosses the $30,000/day mark

Robust tonnage demand in the Atlantic due to an anticipated increase in Brazilian iron-ore export activity in the coming weeks coupled with a rise in Indian coal imports on Capesizes from Australia and Indonesia propelled the C5TC to a five-month high. Although news around the easing of lockdowns in Shanghai has also added a positive sentiment to the market, uncertainty regarding the CCP’s reversal on its zero-covid policy remains. According to the Vessel Supply page in Sea/analytics, 74 vessels are ballasting to Brazil (from the Indian Ocean, South East Asia and West Africa) compared to 86 last week.

Sea/analytics welcomes Dr. Copper

The Sea/analytics team launched the Copper Ore trade flow dashboard in May 2022. Copper Ore is mined primarily in large open pits in Chile and Peru and transported by Handysize/ Handymax ships to smelters in China. Copper is an essential commodity in day-to-day living, from building tools to biology, though most of it is used to manufacture electrical equipment such as wiring and motors. Thus, it is often cited as Dr Copper by commodity analysts as it is used to assess the overall economic health.

Coal shows no sign of respite

Soaring natural gas prices in Europe, increased demand from North Asia, and a power crisis in India (due to the heatwave) have set the coal market on fire. As a result, Newcastle coal futures have consolidated above the $390/ton mark – nearly doubling in value since 2022. The EU’s sanctions against Russia have been beneficial for South Africa as coal exports from their flagship Richard’s Bay Coal Terminal to Europe have surged 10-fold in the past couple of months versus the same period last year. Also, the Indian government’s latest stance of reversing its policy of slashing coal imports has provided significant support to the seaborne market from the demand side.

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