Chinese operators put panamaxes into lay-up

Panamax rates have crept up over the last few weeks, with the Baltic Exchange’s Pacific round voyage gaining around US$2000 the last seven days to more than US$17,600 per day.

However brokers have reported this was down to an artificial lack of readily available tonnage and would do little to entice Chinese owners back into the market.

"We are hearing of owners refusing to fix their vessels," a Singapore broker said.

"Nnormally they want to undercut each other but over time the collective wisdom is to just stop doing it.

"They would rather lay up and wait for the cycle to come back upwards. A lot of the owners are Chinese, many of whom just want to stop for a bit."

Fixing activity for traditional Pacific voyages taking Australian coal to China, and North Pacific round voyages transporting North American grain to Asia, was "flat but steady", he said.

Those owners that were committing to fixtures were operators with tonnage chartered in on longer-term period contracts that needed to keep vessels earning money, even if it was not very much per day.

However, a rival Singapore broker disagreed, saying that gains in the panamax market seen over the last two weeks were down to increased demand for east coast South American grain cargoes by Asian charterers.

"The situation at the moment very much reminds me of how the market was back in April and May," he said.