The Baltic Exchange’s main sea freight index fell on Thursday as capesize vessel rates saw their biggest daily plunge since the onset of the COVID-19 pandemic, in May 2020 on lower iron ore demand.

* The overall index, which factors in rates for capesize, panamax and supramax shipping vessels, fell 74 points, or 5.3%, at 1,320 points.

* The capesizes are setting a negative tone, due to subdued steel and in turn, iron ore demand, said Yiannis Parganas, research analyst for Intermodal.

* The capesize index shed 216 points, or about 20%, its worst decline since May 28, 2020, at 867 points.

* Average daily earnings for capesizes, which typically transport 150,000-tonne cargoes such as iron ore and coal, were down $1,790 at $7,188.

* But rising coal demand amid a surge in oil and LNG prices, a European ban on Russian coal, and increased Colombian and South African exports to Europe could be among the factors that could drive an uptrend in the market during the last quarter, Parganas added.

* The panamax index, which has not seen a single day of gains since July 25, lost 56 points at 1,749 points.

* Average earnings for panamaxes, which usually carry coal or grain cargoes of about 60,000 to 70,000 tonnes, decreased $504 to $15,738.

* The supramax index gained 39 points to 1,698 points, rising for the fifth consecutive session on its best day in over five months.

Source: Reuters