WEEK34 - Dry Cargo Market “Highlights” – 20-August-2010 until 27-August-2010

This was a mixed feeling week. A breather you may say. The large Capes and Panamaxes suffered minor losses, and the smaller two Supramaxes and Handymaxes made minor gains. Overall the general index fell and the overall sentiment is that the overwhelming increased was too rapid and had to correct somehow. Still there are many ships chasing lesser/fewer cargoes and this imbalance of the market is self‐implicated and will sooner become far worse than better. Have owners been shooting at their own feet? Definitely YES!

The shipping markets seem to have regained a great share of the heavy losses encountered during the first two months of this summer period and before August says “kalo xeimona” ‐ a Greek traditional wish for a pleasant winter ‐ to us, we will be in a positive situation where we recovered a great percentage share of the heavy losses in both the indices and actual daily freight hire. The shipping markets were greatly assisted, by the added momentum that were offered in the past 2 weeks by the Capes and the Supramaxes. However the underlying global market fundamentals still pose a great degree of an uncertainty level although overall the picture looks much better than 2 months ago.

China has imposed their game rules in the iron/ore pricing agreement, and the country’s size and import appetite on its own have such great weight that they can and have brought the per tone prices to the desired levels. Russian grain exports embargo/ban went into action as from the 15th August until 31st Dec 2010, and the Russian exports will be limited to 60‐65 mil tones for 2010 as opposed to 97 mil tones for 2009. This is a serious quantity reduction that will be needed to be shipped from alternative locations and this will definitely act positively on shipping freights as the per ton mile cost will increase.

A notable slowdown in period and time charter fixtures was noticeable this week and a total of only 84 fixtures were recorded compared with 112 of last week.

The complete version of our weekly report can be downloaded from:

http://www.cotzias.gr/reports/weekly/Cotzias_2010_Week_34_Report_27_Aug_10.pdf