Bulk carriers have come out of the doldrums

Bulk shipping companies have apparently come out of the doldrums and are making profit after over a year.
Aided by imports of iron ore and foodgrains by China, the freight rates for dry bulk carriers are surging.
The Baltic Dry Index, the benchmark index for such ships, touched 4,381 on November 17, a 14-month high.
The last 14 months were the worst for the shipping industry, a top official of a shipping company said.
"Recession has bottomed out and there has been an uptake in import by China, helping freight rates to surge," he elaborated. The demand for such ships has also increased at Australian and Brazilian ports.
The Baltic Dry Index had plunged to a 22-year-low of 663 in December 2008, sliding nearly 95 per cent in about seven months from an all-time high of 11,793 in May 2008. The rates had collapsed because steel producers slashed output, with recession hitting global consumption.
"Dry bulk ships are making very good profit at this level," said a spokesperson of Great Eastern Shipping.
Capesize vessels, the largest dry bulk carriers, with over 150,000 DWT capacity, are quoted at $ 60,000 a day for Atlantic delivery and $54,000 a day for Pacific delivery.
The break-even for such ships is a maximum of $ 30,000 per day, including their interest costs and depreciation. So, at the current freight rate these ships are making a profit of $ 30,000 on short-term contracts.
However, the tanker segment of the shipping industry has still not recovered from the downtrend in their freight rates, Exim News Service reports.

(Source: Transport Weekly)