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Asia Panamax Dry: Coal freight rates into India flat

The Panamax coal freight market was mostly flat Tuesday, ahead of the Coaltrans conference later this week.

Platts assessed the coal freight market from Indonesia's Banjarmasin port in South Kalimantan to Mundra on India's west coast at $11/mt, unchanged from Monday. The route from Banjarmasin to Paradip port on India's east coast was assessed at $9.50/mt, also unchanged from Monday.

"Yes, with India Coaltrans this week, Panamaxes started flat," a shipbroker in Singapore said.

Another broker said $11/mt is repeatable Tuesday, as "the market is not too different so far from yesterday."

An India-based broker said most market participants are holding off trading and fixing cargoes until they get a clearer view of the market, which they expect to get at the conference this week.

"A lot of people are preparing for Coaltrans and they're not fixing anything until then," he said. "They'll be waiting to find out what is happening before making deals."

The broker said Supramax charterers were seen bidding at $13/mt on cargoes from South Kalimantan to west coast India against offers at $14/mt. Bid and offer levels from South Kalimantan to east coast India were at $12/mt and $13/mt.

CHARTERERS WAITING FOR RATES TO COOL BEFORE FIXING

Charterers looking at Australia to North Pacific as well as those working on Indonesia stems were seen waiting for rates to come off, the first shipbroker source said.

"I've got orders but charterers seem happy not to fix," he said. "[They're] running everything spot, watching the rates slide and supply rise."

"We've seen late March laycans come into the market now, with charterers content to sit back and collect unless they see index-discounted rates," another broker said, adding that North Pacific and east coast Australia has had a slow start to the week with only a handful of these cargoes seen so far.

Owners weren't seen responding to charterers' refusals to fix, market sources said, with one adding that owners would rather keep more of their vessels for spot.

Cargoes moving into India were seen offered at a discount, a source said Tuesday. "Trips to India [were] at a slight discount as owners are still aiming to head there to get the back-end east coast South America grains season," the broker said.

SOUTH AFRICA RATES STABLE

The Panamax coal freight rate out of South Africa's Richards Bay coal terminal into India also held steady Tuesday.

"There's still not much action [out of Richards Bay coal terminal], but [there are] rumors of a little more action for trips back to India and China now," a broker source said, adding that a couple of cargoes were seen emerging fresh in the market late Monday and Tuesday, but no bids or offers were heard.

These cargoes would however, have to compete with the grains business, the source said. "As east coast South America gets busier, Richards Bay gets quieter as charterers usually have to pay higher numbers to get tonnage interested."

The east coast South America grains trade was off to a disappointing start, but market participants were optimistic the grains business will pick up in April.

"Owners have been anticipating a hot east coast South America market for months now, so a heap of ballasters hit the market this year," the broker said. "April should show some stronger fixing levels."

"The grains from Argentina seem to be slow moving at present but we expect this is due to currency issues which will slowly unravel leading to a prolonged grain season," another broker source noted.

Platts assessed the Richards Bay coal terminal to Mundra port at $16.50/mt, and $17/mt to Paradip, unchanged from Monday.

Source: Platts