Reduced demand may not hinder newbuildings for China
News | Published Wednesday, July 14, 2021 9:07 AM
Reported by MARINE ONLINE
China’s softened iron ore imports do not imply a decline for newbuildings
The Baltic Exchange’s main sea freight index revealed rates for capesize, panamax and supramax shipping vessels, shrunk 72 points or 2.2 per cent, to 3,228. The capesize index fell 120 points or 3.2 per cent to 3,650; ruptured a steadily climbing streak.
No affected sectors mentioned
Capesize vessels which typically transport 150,000 tonnes of iron ore, had its median takings fall by $994 to $30,272. Asian Iron ore futures rose with the benchmark Dalian contract advancing more than 3 per cent, as lingering concerns about tight supply of the steelmaking raw material eclipsed expectations of a slowdown in China’s steel demand.
The panamax index declined for a seventh consecutive session by 100 points, or 2.5 per cent to 3,970, the lowest since 28 June 2021. Panamax vessels which ship coal or grain cargoes of about 60,000 tonnes to 70,00 tonnes, had its earnings reduced by $892 to $35,734. Lastly, the supramax index was down 17 points at 2,865.
Chinese companies are increasingly dominant across the entire global maritime supply chain, controlling the world’s second-largest shipping fleet by gross tonnes and constructing over 30 per cent of the world’s vessels in 2019. If anyone is wondering, the Index did not mention anything about steel for newbuildings, or any other sectors involving it. Steel is heavily used for manufacturing industries such as automotive vehicles, consumer electronics and building materials in China.
Findings from the Ministry of Industry and Information Technology (MIIT) instead revealed the republic’s newbuildings orderbook surpassed South Korea’s in 2020. It cited three major indicators that resulted in the stellar performance: completed ships, new and existing orders. These three were leading with 43.1 per cent, 48.8 per cent and 44.7 per cent respectively globally. Trailing behind are South Korea and Japan – with 41.4 per cent and 7 per cent respectively for global newbuilding orders in 2020.