Baltic index hits highest since 2014 on tight supply, higher demand
July 12 (Reuters) - The Baltic Exchange's main sea freight index hit a five-and-a-half-year high on Friday, boosted by stronger demand and tight spot tonnage in the Atlantic region.
* The Baltic index , which tracks rates for ships ferrying dry bulk commodities, rose 2.7%, or 49 points, to 1,865, its highest since January 2014. The index has tripled since February.
* The index rose 7.2% this week, to post its fourth straight week of gains, mainly driven by strong demand for vessels that ship iron ore from Brazil.
* The capesize index rose 125 points, or 3.7%, to
points, its highest since Aug. 15, 2018.
* Average daily earnings for capesizes, which typically
170,000 tonne-180,000 tonne cargoes such as iron ore and coal,
rose $684 to $27,389.
* "It (strength in indices) is due to continued growth in
volumes out of Brazil," said Lars Ostereng, an analyst with
* Iron ore prices have more than doubled this year as port
across China shrank to their lowest since early 2017 due to
reduced shipments from top exporters Australia and Brazil, as
well as robust demand.
* A restart of Vale SA's Brucutu mine in Brazil,
was shut in early February after a tailings dam burst killing
more than 240 people, has prompted increased demand from the
* "For now, it seems, there is appetite definitely to import iron ore (from China). One reason freight rates have been so strong is we saw quite a lot of fixing in the Atlantic when the vessel availability was quite sparse," Ostereng said, adding that fixtures were done at higher levels than the previous ones.
* The panamax index rose 64 points, or 3.4%, to
points, its highest since December 2013.
* Average daily earnings for panamaxes, which usually carry coal or grain cargoes of about 60,000 tonnes to 70,000 tonnes, increased $518 to $15,536.
* Tight spot market for capesize vessels has driven iron ore shippers to book panamax vessels, driving rates higher, analysts said.
* The supramax index edged 19 points higher to 879 points, its highest since January.
(Reporting by Nallur Sethuraman in Bengaluru)
1-646-223-8780, Outside U.S. +91 8067496031); Reuters Messaging: firstname.lastname@example.org))