16OCT2019 - NEWS - Pacific Basin Sees Tight Dry Bulk Market Conditions Until the End of 2019

The dry bulk freight market strengthened significantly in the third quarter with market freight rates in early September reaching multi-year highs across all dry bulk segments. Improved demand was driven by seasonally strong grain exports out of South America and the Black Sea area and a return to normal levels of exports following earlier disruption to Mississippi River grain and Brazilian iron ore traffic. Global fleet inefficiencies and therefore tighter supply have also supported stronger rates, as ships prepare to comply with IMO 2020 low sulphur fuel regulations.

PACIFIC BASIN VESSEL EARNINGS ARE INCREASING ON STRONGER MARKET CONDITIONS
We generated average Handysize and Supramax daily time-charter equivalent (“TCE”) earnings of US$9,480 and US$11,580 per day net in the third quarter, representing an improvement of 3% and 7% respectively compared to the first half of the year. In the first nine months of 2019, our Handysize and Supramax TCEs outperformed the BHSI and BSI spot market indices by 42% and 21% respectively.

Note that the much improved freight rates in September will primarily impact our fourth quarter earnings due to the time lag between spot market fixtures and voyage execution.