15 – 21 June 2020
Source: Allied Shipbroking
Shipping may well make claim of carrying 90% of world trade, yet its China that accounts for 30% of the world’s key commodity imports that really makes for a big driver of dry bulk freight rates. It takes up more that 60 percent of the iron ore and soyabean markets, while accounting for roughly 30% and 20% of the global trade in fertilizers and coal respectively. Its dominant position has been more than emphasized by the recent rally that was witnessed in key parts of the dry bulk freight market these past few weeks. With China having already eased back from its lockdown restrictions, traders have utilized the relatively soft commodity prices to snap up large volumes. The volumes have been considerable and have gone a long way in helping freight rates recover. Yet with economic activity in China still struggling to find a strong foothold, the situation could be more troublesome than one might think.