Nowadays there is a period of freight rise in the Caspian Sea. First of all, this is caused by the shortage of Russian-flagged tonnage in the region for shipments of new corn harvest from Volga ports. The demand for such a fleet is increasing, as a large amount of grain is stored in river elevators, where the Owners of vessels with the Russian flag work from. A part of Charterers has already signed contracts for the winter period at a growing market in the hope that these deals will turn out the most profitable. The other part considers that the freight market will grow in the nearest future, and contracts would be concluded at more advantageous rates. In the context of fleet deficit, some Traders consider other options for grain transportation. Last week the demand for hauls by cabotage voyages from Samara, Tolyatti and Kazan to the Astrakhan port increased; from there the corn is carried out to Iran by non-Russian-flagged vessels. Therefore, in lights of the higher demand for shipments from the river, rates reached USD 58 pmt of barley basis Samara – Iran. This is 2 USD more than 40 weeks.
In the Azov region, on the contrary, freight has dropped over the past period. Market participants connect it with the time of uncertainty. As expected earlier, the export pace of wheat to Turkey continues to decline. Due to the fact that a lot of Turkish millers forfeited credit support of banks requests from the Turkish partners for buying Russian grain significantly decreased. The requirement for wheat in the domestic market is satisfied with purchases of the Turkish Grain Agency (TMO). Thus, the reduction in cargo traffic to Turkey led to freight rates in Azov basin started to go down.
Now a bacteriological analysis of grain is still up-to-date. At the same time, Charterers note that if tests were conducted in 7 days last week and led to substantial delays in shipments, now situation has changed. Today phytosanitary researches takes less time, and the dispatching of vessels is much faster. Despite this, many Charterers prefer to wait for the total cancellation of inspections in order to protect themselves from possible losses due to bureaucratic delays. As a result freight reached USD 31 pmt of wheat basis Rostov – Marmara. This is 1 USD less than previous period.