The activity of raw materials importers continues to stimulate the wind-up of freight. Rates from Rostov to the Black Sea have grown up to USD 30 per ton of grain, which is significantly higher than the usual level for this period of time. This strong demand for tonnage is caused by several factors. Firstly, coals exports have started to grow dramatically again after a 34% drop in April. Secondly, grain is exported on an incredible scale. Besides, shipments of the new crop will begin in a few weeks, so the volume of grain exports will not decrease in the near future. And the third factor is an increase in the export duty on ferrous steel scrap to the level of 5% for 180 days. Therefore there is a large amount of cargo that needs to be shipped during June, which overheats the Azov market.
Charterers of non-grain raw materials are quite active. Significant amounts of scrap metal are shipped from Ukraine in small parcels, including river ports. The voyage of the vessel with a cargo capacity of 3000 tons from Kherson to Marmara is now being fixed at the level of USD 100k lumpsum. Most likely, processors are trying to catch up before the new grain appearance on the market, since it is expected that the freight rates will be even higher.
The demand for steel products is outpacing supply this year as overall output is also low compared to previous years due to mining lockdown. Chinese steel export tax possibly being announced in mid-June in this regard ferrous scrap prices continued to increase worldwide. Governments of other of main steel producing countries try to regulate the prices at this field. Other raw commodities which shows positive dynamics also are being pump up thus all this developments increase the volume of trading operations. The Owners react respectively. The Spot market level increase in average USD 2-4 pmt within Atlantic. TCE for round Europe handy size trip reported to be USD 28k-30k. Supramax rates amounted to USD 27k-28k, expecting USD 30k on 24th week. Cross Atlantic big coasters TCE revealed on USD 15k-17k and intra-med rates on USD 26k. Owners expecting the freight level increasing up to 10-20% till end of June.
From various Owners, who are involved in sugar business from both EC and WC India to Red Sea we hear about lack of cargoes in that area. Most of the offers you can get in Red Sea are fertilizers going to WAFR, MED and South East Asia directions and small amount of agriculture cargoes like beet pulp. Owners are fighting for every cargo in order to reposition their vessels back to Indian ports. In addition, some of the Owners determine phosphates or potash as dirty cargo and exclude it from their work list. Some consider ferts as dirty cargo and prefer to ballast to WCI for their habitual and highly paid sugar business; others fix voyages with fertilizers or agriproducts to South East Asia and ballast to India from there.