Pacific rates to dip as holiday season begins across region.
CHARTER rates for panamax tonnage trading in the Pacific are set to see a modest slide this week as charterers and brokers join most of the rest of Asia on holiday for the lunar New Year and associated festivals, writes Keith Wallis in Hong Kong.
But brokers said the market would remain remarkably resilient and could show a modest recovery towards the end of this week as the number of fresh inquiries increased.
?The Pacific panamax market was gaining strength last week before Friday"s fall, which was due to a complete absence of fixing activity,? said one Hong Kong-based broker.
He added that this was reflected in the drop in rates both for a north Pacific voyage and backhaul voyage from the Far East to the northern European continent.
?Charter rates for a north Pacific voyage are $23,000-$23,500 per day, which is slightly below the index levels,? the broker said.
Backhaul rates, by comparison, were slightly below $16,000 per day.
?There has not been much change in backhaul rates since January,? the broker said.
He added: ?I would expected these levels to slip slightly in the next day or two before regaining ground on Thursday or Friday, when most of Asia returns to work and chartering activity picks up.?
The broker thought the lack of inquiry coming out of China, which does not end its New Year holidays until next Monday, may dampen sentiment. But he also forecast an increase in the number of coal fixtures coming out of Australia and Southeast Asia.
?Coal and some grain cargoes had been driving the Pacific panamax market and I see that continuing after the holidays,? the broker said.
He said that coal fixtures concluded before the start of the holidays included the 2007-built, 82,471 dwt Nord Phoenix , which was fixed by Oldendorff at $24,500 per day, while unknown charterers took the 1996-built, 70,108 dwt SD Nova for a voyage from Indonesia to Japan at $23,000 per day.
He added that congestion at some ports in eastern Australia had also helped to support Pacific panamax rates.
A Singapore-based broker agreed that rates for panamax tonnage in the Pacific were likely to remain relatively steady on the back of firm inquiry levels.
But he also pointed out rates for chartering ships for short periods of 3-5 months were also strong despite few inquiries.
?Spot rates are lower than charter rates for a short period and while period rates are healthy, owners are reluctant to commit even for four to six months. This suggests Pacific panamax owners are confident spot rates will climb once the Asian holidays are over,? the broker said.
He said that Danish owner and operator Norden fixed the 2001-built, 75,311 dwt Nirefs for four to six months at $26,000 per day. The broker added that charter rates for an 11-13-month charter were around $24,000 per day, which was slightly more than the spot rates for a north Pacific round voyage.