The freight market of the Caspian region is showing a sheer fall. Due to the lack of sufficient cargo offers freight rates showed a decrease of USD 3-5. The abundance of tonnage supply with the Iranian flag applies pressure on freight rates in the Caspian Sea ports. After the imposition of latest sanctions against Iran, many Charterers abandoned the idea of using vessels with the Iranian flag, for which reason Owners are forced to dump amid hopes to get cargoes at low rates. Owners of the fleet with the Russian flag turned out to be hostages of this circumstance, because they have to compete with the abundance of cheap Iranian tonnage.
Transit cargoes from the Black Sea to the Caspian Sea are not in great demand among Owners. The key reasons for this are the reduction of freight rates at this direction and the lack of back hauls from the Caspian Sea. The situation may be changed by the commissioning of nitrogen fertilizers plant in Turkmenistan, but the completion of the repair is postponed for a long stretch of time. According to the latest update, the launch of the conveyor line at the plant is scheduled for the beginning of June.
It is expected that most of Owners working in the southern regions will try to fix their vessels this week, because the business activity will be extremely low from 3rd to 9th of June. The reason for this will be Ramazan Bayrami in Turkey, as well as holding Russia’s largest Grain Round in Gelendzhik, where gather together key market players.
The Azov-Black Sea market remains stable. The lack of rates dynamics, low demand for tonnage and increased interest of Owners in long voyages with back hauls are outstanding features of the region.