food outlook No.1, April 2005 
global information and early warning system on food and agriculture(GIEWS)

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Basic food commodities

Other relevant agricultural commodities

Ocean freight rates


Special features

Statistical appendix

Statistical note

Ocean freight rates

(Contributed by the International Grains Council)

Dry bulk freight rates continued to rise in November due to sustained Asian demand for minerals and grains. A seasonal increase in grain and soyabeans shipments, especially in the northern hemisphere, together with the weakness of the US dollar, further contributed to the advance. By early December 2004, the Baltic Dry Index (BDI) had surged to a new record of 6 200, surpassing the February 2004 peak. However, rates then fell back heavily on lower than previously expected Chinese demand, congestion in Asian ports and weaker crude oil prices. As a result, the BDI lost 30 percent in December - January, dropping to 4 307. After the Lunar New Year holidays, the market strengthened again on renewed Asian demand and good export prospects for the new South American grains and soyabeans crops. By the end of February the BDI had recovered to 4 878.

In the Atlantic, Panamax rates followed an upward trend until the second half of December, with support coming from the seasonal increase in maize and soyabeans shipments, following record crops in the United States. The major grain rate from the US Gulf to Japan went up from US$53.75 to US$70.00 per tonne. However, by mid-February the rate had fallen to US$57.00 per tonne, due to a lack of demand, more recently recovering a little to US$60.00 per tonne. Panamax rates in the Pacific followed the same pattern, climbing from US$31 000 in early November, to peak at US$50 000 per day, then dropping to US$30 000 before recovering to US$40 000 daily by the end of February. Period Panamax rates from Europe to East Asia went up from US$43 000 to US$50 000 per day by mid-December, only to return to US$43 000 daily by the end of February.

Rates in the Capesize market continued to improve in November, supported primarily by Chinese charterers. By the end of that month, voyage period rates from Brazil to Far East Asia were indicated at US$100 000 per day. However, the market subsequently fell on reduced mineral demand, continuing congestion in China’s ports and an anticipated drop in steel prices in 2005. Over the period, the voyage rate from Brazil to China fell from US$42.00 to US$38.00 per tonne.

The Handysize market followed the general dry bulk market trend, with typical voyage rates rising to US$32 000 per day for short-term charters in early December, then dropping to US$24 000 in mid-December and recovering to about US$30 000 per day in February. The grain rate from Brazil to the EU (Antwerp-Hamburg), quoted in late February at US$51.00 per tonne, followed a similar path, also staying well below the November peak.

food outlook


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