China agrees to resume purchase of US agriculturals, but so far there is little evidence of true volume..

Weekly Report 10/11/2025

Next Week's Predictions:

• Capes :

  • The Cape 5TC index went up all week but stayed within its $22,000 to $28,000/day range which in itself shows signs of lethargy.

  • So, no great shakes, a bit more spot activity, tight tonnage lists in the Pacific and good cargo enquiry levels in the North Atlantic. But not enough to get this market on another level as there is sufficient tonnage to cover the present requirements.

  • Sentiment : Timid 6

    
    

• Panamax :

  • The Panamax 4 TC continued its recent revival by improving steadily for most of the week as spot opened on Monday at $14,754/day and closed on Friday at $15,265/day.

  • Both basins were busy as owners attempted to position themselves somewhere close to the US East Coast by the end of November in order to benefit of any grain stems coming out the US Gulf with final destination China.

  • Sentiment : 6
    

Dry Bulk:

• Headline exports in China dropped for the first time since February. Export growth fell sharply from +8.3% y-o-y in September to -1.1% y-o-y in October (consensus: +2.9% y-o-y) marking the first y-o-y decline in 8 months.

• The investigation of the legality of Trump's tariffs by the US Supreme Court could conclude in the next few weeks. If the ruling is against the tariffs, this could lead to a weaker USD and higher commodity prices.

Technicals/Open Interest/Traded volumes  :

Spot Indices and weekly FFA prices :                          

BDI            07/11    2104 - 31/10    1966

5TC BCI    07/11 27,709 - 31/10 24,288    

4TC BPI    07/11 15,165 - 31/10 15,053  

11TC BSI   07/11 16,678 -31/10 16,762

Weekly traded volumes and open interest:

Open Interest 599,518 lots - (657,842 lots)

Capes/Iron Ore/Bauxite:

• Iron ore prices had a negative feel about it but managed to stay above the $100 /tonne mark and this despite fresh supplies out of West Africa starting to hit the spot market.

• The increase in Chinese iron ore imports has been facilitated by growing exports out of Brazil, with volumes setting a new historic high in July, and in turn is a key contributor to nautical miles travelled.

• Together with growing importance of bauxite exports out of Guinea the opening of the Simandou iron ore mine and related seaborne export facilities will continue to be a significant contributor to Capesize volume growth in 2026 and beyond.

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• Why will the iron ore flow out of Simandou rather than out of present areas like Australia?

  • It’s the largest deposit of high-grade iron ore which the Chinese really want as part of their green transition.

  • Chinese firms own most of the Simandou project, so they will make it work at the detriment of Australia for example.

  • Higher grade iron ores produce better margins for the steel producers and consequently profitability improves for the Chinese steel industry.

  • Chinese/Australian relations are on tenterhooks making the slightly lower grade of Australian iron ore even less attractive.

  • Simandou iron ore is supposed to be competitive which will push iron ore prices lower.

• Worldwide iron ore loadings on Capes reached 26.4 million tonnes last week, a 5 year seasonal high, with Brazil ore exports reaching 5.2 million tonnes in the last 7 days.

• 1 year period levels for standard Capes (Baltic types) have improved last week by about $400/day to reach $22,800/day.

• The Cape physical market had a positive week as both C3 and C5 reached $23.35/tonne and $10.35/tonne respectively putting further upward pressure in the north Atlantic market which was awash with fresh enquiry and resulted in an overall better mood.

Panamax/Grains/Coal:

• Agricultural imports into China during October improved and could see further recovery in the coming months, as China has resumed purchasing US farm goods. But so far, we have only witnessed gestures of goodwill rather than proper volumes being booked into China.

• Brazilian soybeans remain significantly cheaper on a CIF basis, especially from February 2026 when the new crop floods the market. It remains then to be seen when the US will ship its first batch of 12 million tonnes and the best window seems to be between now and the end of January 26.

• Indian power and coal fired generation forecast for 2025 is revised lower and could show a first annual drop since Covid. In contrast Chinese coal prices have rallied as domestic production is being cut by local safety regulations.

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• Indonesian coal exports are under pressure from falling demand from India and China with prices remaining under downward pressure.

• South Korea’s coal imports in Q3 jumped by close to 10 million tonnes compared to the previous quarter which stood at 22 million tonnes.

• Available Atlantic Panamax keeps on slowly dropping and with potential better enquiry emanating from the grain side in the weeks to come it could be argued that better rates are on the horizon.

• The Panamax cash markets were at best steady this week as the Atlantic benefited from low tonnage availability and decent order flow whilst the Pacific improved throughout the week to finish on a better footing.

Shipping and Decarbonisation:

• Eu carbon markets lost some value this week due to a weaker compliance auction and overall, slightly bearish sentiment. But the COT report (commitments of traders) indicated last week a new record of net long EUA positions for Investment Funds, so it’s a buy the dips environment.(Vertis)

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