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Tanker markets gain amid US-UK attacks on Houthis in Yemen.
Suezmax markets had a positive week with rates generally gaining across all routes. The US Gulf was again the primary driver of strength, although the list of outstanding cargoes had shrunk towards the end of the week.
Aframax similarly experienced strength across the board, with the Mediterranean market a standout region of strength. The Mediterranean was boosted by continued ballasting of vessels towards the US Gulf, as owners looked towards the superior rates, while rumors of Zawia, Lybia, reopening also offered support. Aframax rates on the UK Continent also gained supported by surrounding markets.
“US Gulf remains strong, helping pull rates higher across the board.”
VLCC markets strengthened after several weeks of sideways to declining price action. The move was driven by strong enquiry levels, which led to improved owner sentiment and their push for higher rates. The US Gulf remained a stand-out region with high rates as cargo volumes were elevated.
Aframax ECO, 12 months TC
Aframax, Average spot
Suezmax ECO, 12 months TC
Suezmax, Average spot
Source: Clarksons Research
Rates slide despite ongoing Red Sea developments.
Capesize markets underwent a significant correction, bringing rates back around the levels seen prior to the Capesize rate surge in December. The move resulted from the clearing of remaining 2023 tonnage, as holiday-driven demand surges were unwound. Capesize markets faced a lack of enquiry in both basins, which saw tonnage lists grow.
“Holiday demand backlog has been unwound, bringing a decline in rates, but at levels above 2023 averages.”
Panamax rates also eased as cargoes were generally weak. Owner sentiment in the Atlantic was dampened by expectations vessels will arbitrage to the Atlantic on expectations it will remain stronger than rates in the Pacific.
Handy markets saw initial strength on the US East Coast; however, that faded somewhat towards the end of the week. Overall, Handy rates retreated as, ultimately, vessel supply outpaced supply, particularly in the North, with a better balance in the South.
Capesize, 12 måneders TC
Kamsarmax, 12 måneders TC
Source: Clarksons Research
Vehicle exports from China to remain robust in 2024.
PCTC markets continue looking towards China as a driver of tonne-miles in 2024 following the rapid vehicle export growth in 2023, which is set to continue in 2024, as Clarksons Research projects vehicle exports from China to grow 12% year-on-year in 2024.
“Vehicle exports from China forecast to grow 12% in 2024 – Clarksons Research.”
Last week it was reported that Chinese EV manufacturer BYD (the largest producer of EVs globally, recently overtaking Tesla) has launched into operation its first PCTC vessel with a carrying capacity of 7,000 ceu (car equivalent units). BYD’s exports grew 334% year-on-year in 2023, as the company looks beyond the domestic market, accounting for around 5% of total vehicle exports from China. The launch of its own PCTC is a signal that BYD expects to continue ramping up its exports in the coming years, with eyes on Europe as its primary end export market. BYD has announced ambitions to sell 800,000 vehicles to Europe by 2030, produced both in China and locally. BYD has ordered a further 7 PCTC vessels with options for an additional two newbuilds. The expected investment of around USD 700 million could see BYD with a carrying capacity of over 70,000 CEUs.
5000 CEU – 12 måneders TC
6500 CEU – 12 måneders TC
Source: Clarksons Research
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