The Summer of Our Content

Charter brokers are talking about this spring’s surprisingly buoyant dry charter market. It has remained stronger for far longer than most people could have foreseen, and caught many of the industry’s most astute brokers by surprise. A ready refrain is that even the respected Boston based consulting group Marsoft, “did not predict it.” But some businesses have certainly benefited.

That may be because today’s charter rates are not solely sustained by a substantive increase in the demand for ships. In fact, most charterers will tell you that the amount of cargo being moved is less than last year. There has been a general switch from oil to steam coal demanded by power companies and, yes, there is a bit more coal for the UK via Rotterdam transshipment. In addition, there has been a change as to where steel is produced which has resulted in increased ton miles – i.e., ships will be spending more time in the water, thus depleting the supply of tonnage. Still, economic reports out of the US, EEC and Japan are not great, giving little indication that the recession is behind us.

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