With the Cape market trading at close to 3 year lows and average TC returns below OPEX levels, it should come as little surprise that there has been a pick up in scrapping in the sector. Year-to-date we have seen 16 Capes and VLOCs sold for demolition, representing 2.94m dwt, already more than was removed in total in 2018. With the demand side struggling, are we going to be reliant on demolitions to keep the market going?
Manganese is critical to the single largest driver of the dry bulk market: steel production. As we see in other metals, Chinese investment is changing the dynamics of production and shipping of what had previously been a pretty stable market.
Six weeks on from the Brumadinho dam collapse, we look at how the freight market has been impacted by the disaster. While the smaller ships march on, the Capes are definitely struggling.