Rates will remain below about $11,000 a day for the rest of the year, compared with a breakeven point of about $23,000, according to Johnson Leung, head of regional transport at Jefferies Group Inc. in Hong Kong.
The surge in scrapping has failed to revive capesize rates because 117 new vessels have been launched this year as yards work through orders placed in anticipation of a surge in iron ore and coal shipments to China. Instead, China is paring commodity imports to help cool growth, while Vale SA (VALE), the world’s largest iron-ore miner, is adding vessels larger than capesizes to cut its reliance on the charter market.
via Scrapping Record Fails to End ‘Nightmare’ for Shipowners: Freight Markets – Bloomberg.
Jefferies Group’s Leung on Asia Shipping Industry