How low can the dry bulk market go?
Published 23. Nov 2021 11:17 AM
During the last month, we have witnessed a sharp decline in period rates, amid extraordinary improvements
The improvements made everyone wonder whether bulk was next in line to experience the same effects as the container segment with historic period rates and asset prices awaiting, but the reality turned out to take a surprising shift, as the dry bulk period rates have declined and seem to continue to do so. The sentiment has taken a sharp turn for the worse, with lower freight rates and period rates, which raises the question of whether the current market is just a temporary stabilization or if further decline is yet to be seen.
The main reason for the drop can be found in the dropping coal prices as well as the easing congestion, as China has increased its domestic coal production to meet their requirement which has resulted in a slowdown in imports.
Week 42 vs Week 46 period rates:
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