Shippers benefit as China laps up Brazilian iron ore

Shippers benefit as China laps up Brazilian iron ore

Chamber Articles Category: Industry News Post Date: 01/02/18 Source: Reuters By: John Benny
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U.S. dry bulk shippers are set to post strong revenue growth in the next two years thanks to soaring Chinese demand for high-grade iron ore from Brazil and Australia.

To combat severe winter smog, China has slashed iron ore output, pushing steel mills in the world’s second biggest economy to import more high-grade ore.

China also wants to make pollution control a priority for the next three years.

“China’s increasing demand for higher quality iron ore, along with greater supply coming online from Brazil, has boded well for capesize rates in recent months ... we believe this trend will continue going forward,” Gary Vogel, the chief executive of New York-based Eagle Bulk Shipping Inc, told Reuters.

Average rates for capesize vessels — massive ships that typically transport 150,000-tonne cargoes — are expected to jump to about $24,000 next year from less than $14,000 in 2017, Morgan Stanley analyst Fotis Giannakoulis said. Read Full Article