Region: Russian River, Azov / Black Sea, Caspian
Trade: Coaster shipments
As it became known at the beginning of this week, Turkey has introduced an asymmetrical measure complicating documentary procedures for importing wheat, corn and oilseeds in the country. Now Russian Exporters will have to apply for additional permissions for delivering their goods to Turkey, which can trigger protracted delays and cancellings of already fixed vessels in the short run, as well as a decrease in freight rates for voyages from the Azov Sea in the long run.
According to the latest information received from Traders, in other countries buying Russian wheat, grain prices has shown radically negative dynamic, as market participants have been trying to resell wheat intended for Turkey to other countries where possible.
Importers in the region are using the desperate position of Traders and have already started to knock down rates on new contracts, which leaves Ship Owners no hope for any extra freight premium and will lead to a decrease in rates.
Ship Owners, from their side, suppose that freight rates must keep at the current levels for some more time due to another new closure of the Kerch Straight (11-14/10), impacting directly the amount of tonnage in the region.
The chances are, by the moment of opening the Straight, most part of the fleet stuck on the Black Sea side can be cancelled for arriving late and due to Owners’ reluctance to move the laycan dates. In this case an extensive amount of free spot tonnage can appear at once.
The main beneficiary of the current situation, apart from non-Turkish Importers, is Charterers of non-grain and cheaper cargoes, who for the first time in so long have got an opportunity to regulate the freight market in the region.