Earnings of Iron-Ore Carrying Ships Down on Poor Chinese Steel Demand
With China and its steel making industry continuously slashing its production output and ultimately decreasing import demand, revenues of capesize ships that haul steel making raw materials iron ore and coal have been hardly hit and fell for a third day.
According to the Baltic Exchange, daily returns of capesize vessels slid 7.2 per cent to $28,214 on Friday. The Baltic Exchange is a London-based provider of freight costs on 29 dry-bulk routes.
Although three capesize vessels were hired for spot, or single- voyage loadings, two of them were booked to carry iron ore to China from Australia "at $11 a ton, from rates above $12 a ton at the beginning of the week," Omar Nokta, a New York-based analyst, told Bloomberg.
Chinese steel production for October have fallen 6.9 per cent to 1.80 million metric tons from the same period in September. China is the world's top global steel producer.
Prices for iron ore imported into the Chinese city of Tianjin retreated for a 15th session, declining 2.7 percent to $116.90 a ton, according to figures from The Steel Index Ltd. That's the lowest level since Dec. 29, 2009, the data show.