Cross-NWE clean freight rates plunge on weak fundamentals: sources

Cross-Northwest Europe clean freight rates have dropped significantly amid seasonal ice premiums dissipating and cargo activity relaxing, sources said Thursday.
Clean freight rates to load 22,000 mt on a Cross NWE route have fallen almost 100 Worldscale points since a March 15 height of w280, according to Platts data.
A shipbroker said: "Drops like this can happen for sure, although I must admit this year was a particularly quick drop in numbers."
However, sources did not convey alarm, nor point to abnormal causes. "It's simply supply and demand. You see this when there are too many ships and not enough cargoes."
Another broker said rates usually fall as the weather warms. "It's the [end of the] ice season. Simple as that," he said.
The market has not viewed slight, recent jumps in Worldscale rates as signs of market recovery. When asked about increases earlier this week from w162.5 to w165, a shipowner said the market "will remain at these levels for the next two or three months. I really do not think it is strengthening."
Other market participants echoed these sentiments, adding that rate increases were often the result of location or port-specific premiums.
"Usually when the market is poor, loading areas where you have longer ballast voyages tend to pay some premium," said a charterer. The Cape Blanc was recently fixed for a May 16 loading out of Brofjorden, Sweden, across NWE at w167.5, but other fixtures had been reported at lower levels such as w165, Platts data shows.
A source said: "Brofjorden is particularly difficult for flexi-sized tankers [ships with approximately 20,000-24,999 dwt] because the port authorities changed their towing arrangements and now require all vessels to have upgraded towing facilities. However, only a few have them."
Source: Platts