The global freight market showed a clear split in mid December, with capesize dry bulk vessels extending gains while smaller bulk segments softened and tanker markets remained firm, underscoring diverging fundamentals across shipping sectors.

The Baltic Dry Index edged lower on December 15 but remained higher on a monthly basis, reflecting ongoing volatility rather than a reversal, according to market data and broker reports. Capesize earnings improved modestly across most basins, while panamax, supramax and handysize segments faced weaker demand and marginal rate declines.

Market and operational impact

Capesize vessels benefited from a more balanced supply demand picture, supported by iron ore flows and steady construction related cargoes. Brokers reported firmer sentiment in both the Atlantic and Pacific, with forward freight agreements pointing to gradual rate improvements extending into 2025 and 2026.

“Capesizes are currently the only dry bulk segment showing consistent momentum,” said an analyst at The Baltic Exchange, citing tighter vessel availability and more predictable cargo programs from major miners.

By contrast, panamax, supramax and handysize markets struggled to maintain momentum. Higher fleet growth, trade disruptions linked to sanctions, and uneven grain demand weighed on activity. Charterers were able to push rates slightly lower on several routes, particularly in the Atlantic.

Coal and iron ore remained central to market direction. While iron ore volumes held steady, several industry forecasts project global coal exports to decline in 2025 and 2026 as energy transition policies accelerate. Analysts said this trend could cap upside potential for the wider dry bulk market, especially for mid sized vessels heavily exposed to coal trades.

Tankers outperform on geopolitics and trade inefficiencies

The tanker market continued to outperform bulk shipping, with crude tanker rates posting minor gains and product tankers holding steady at elevated levels. Spot rates remained well above long term averages, supported by high fleet utilization and longer voyage distances.

According to industry data, supertanker utilization reached a seven year high, driven in part by sanctions on Russian oil that have reshaped trade routes. Cargoes moving on longer hauls have increased tonne mile demand, absorbing available tonnage.

“Sanctions are creating inefficiencies that work in favor of tanker owners,” said a market update from Teekay Tankers, noting that vessels are tied up for longer periods despite only modest growth in global oil demand.

Newbuild deliveries are expected to rise in 2026, which could moderate rates later next year. However, analysts said the near term outlook remains firm as geopolitical risks persist and fleet growth remains constrained in 2025.

European coaster markets and wider outlook

In regional markets, European coaster activity slowed further. Rates declined slightly in the Baltic Sea and on the Continent, while the Black Sea remained stable and the Mediterranean recorded marginal gains. Ongoing geopolitical risk linked to the war in Ukraine and related sanctions continued to shape cargo flows and trading patterns.

Fleet growth remains a central concern across shipping markets. Nearly 600 new bulk carriers are expected to enter service in 2026, although increased demolition activity could offset part of that expansion. Seasonal demand, port congestion, and regulatory changes are likely to add further volatility in the months ahead.

For now, the freight market remains defined by divergence. Capesizes and tankers are finding support from structural and geopolitical factors, while smaller dry bulk segments face a more challenging path into 2026.

Source: Breakbulk News