In the Azov region, the 37th week can be considered a key one before the market formation at the end of September and the beginning of October. If the freight market was still trying to grow at the beginning of the week, then at its end Owners were already paying attention to voyages with minimal margins in order to wait out the period of falling rates. Thus, on Monday-Tuesday, when discussing shipments of already paid parcels for the middle of the month, it was possible to get from Charterers a rate at the level of USD 22 per ton of wheat on the basis of the voyage from Yeisk to Marmara. However, amid news about the situation on the commodity market, participants assumed that in the second half of September, there will be less volume of grain in the Azov Sea ports than at the beginning of the month. This may be resulted by problems with cargo delivery; almost all market participants have faced this issue. In view of this, at the end of the week, voyages from Azov or Rostov to the Adriatic Sea became quite competitive at rates of just under USD 40. However, there is expected no freight collapse; the market will be supported by upcoming corn crop.
During the 37th week, there was observed a lack of spot tonnage the Azov region, which was completely fixed a week before. As is usually the case on the growing market, short voyages were favored at the beginning of the week. It was needed to add USD 2-3 for the long-distance voyage in order to arouse the Owners’ interest. And only Owners of small vessels with deadweight of up to 2000 tons were eager to compromise on rates: due to the low cost of port call, they made a good profit in the economy of the voyage. They most likely will be in high demand in the near future, since the entire river-sea fleet will be sought on a short leg.
The freight market in the Azov and Black seas regions generally follows in the wake of fluctuations and changes in prices on the global commodity market. At the moment, in the context of growing FOB prices for grains, trading is carried out in small parcels. The Russian ports of the Azov Sea are the most convenient for working with parcels of 3-5 thousand tons. This is one of the reasons why, amid low rates from Ukraine, the Azov market does not fall, despite the problems with the delivery of grain.
Black Sea grain may still be called the most competitive, and the dynamics of price growth for it on the terms of FOB deliveries was also observed in the region. Due to the poor harvest, the offer of grain from the Western ports of the Black Sea and the Danube is quite small this year. Prices for both Russian and Ukrainian grain have increased significantly, and this process continues. In view of the fact that there is not much cargo on the market for the second half of September, working on sales for September is still underway. Thus, it is expected that the 38th week will form the freight market for the rest of September and the first week of October.
In the Caspian region, the Turkmen “Garabogazkarbamid” plant was stopped due to an accident. For this reason, the main part of the Russian-flagged fleet cancelled its voyages. The repairs are expected to last not less than two to three weeks. Thus, as of yet, until the plant starts working again, there will be observed a growing demand for loading grain from river elevators to the Black and Marmara seas, or for any other loading from ports of Turkmenistan or Kazakhstan with work in transit.