In the Azov–Black Sea basin, coaster segment rates in the third week of October held at the high $40s USD level (basis Rostov–Marmara).

Deals are taking place at around $47–48 USD/PMT. The purchasing power of Turkish importers has not yet recovered, and the shortage of available tonnage in the 3,000–4,000 DWT range has passed. Most likely, freight rates will decline until the end of the month, but we expect growth in November–December before the season closes. The main factor complicating the Azov–Black Sea region remains the Kerch Strait passage. Trade from Russian Azov ports to Turkish ports is still hampered by waiting times in queues, especially for foreign vessels.

Major deep-sea tonnage groups are still considered to be at fairly high levels. In the third week of October, daily rates for handy, supra, ultra, and panamax segments rose by almost 40% compared to the end of summer 2023.

Supramax from the Black Sea to FEAST is fixed at around $24,500 USD/day. Approximately the same level applies to the EMED–FEAST route. Handysize on the Continent–South America route is at $12,600 USD/day. Backhaul voyages from ECSA to the Continent in the handy segment are at $17,500 USD/day. Rates on the main Russian wheat export route (deep-sea Black Sea shipments) remain at an average of the low $20s USD level (RUS BLACK SEA–EMED) for vessels of 25–30,000 DWT.

Major Russian wheat suppliers are no longer ready to sell at a discount, as they did in early-to-mid summer 2023. In the coming months, we are likely to see a decline in wheat exports and a shortage. At the same time, Romanian authorities are striving to increase transshipment of Ukrainian grain from anchorage. Towards the end of the year, exports of wheat from France, Romania, and Ukraine are expected to fall significantly (traders in these countries are holding the price around $210 USD FOB), while Russian wheat will enter the market in larger volumes. The key factor here is the increase in Russian export duties, which make it less profitable for traders to sell. According to Rusagrotrans, the October 2023 forecast for wheat exports has already been reduced from 4.5 million tonnes to 4.4 million tonnes.

The Baltic market remains consistently high. Handysize vessels on the RUS BALTIC – SOUTH AMERICA route are trading at around the mid-30s USD (wheat).

The market is also strong on the Russia–China export route: Handysize vessels on the RUS BALTIC – CHINA route are fixed at high 50s USD. According to our forecasts, Baltic market rates will continue to rise with the onset of winter, as part of the tonnage shifts to warmer seas, while rates remain higher thanks to the availability of ice-class vessels.

Transit fees for passing through the Suez Canal will rise by 5–15% starting mid-January 2024.

Freight rates on BALTIC/BS/MED – PG/FEAST routes are expected to grow for handy, supra, and ultra segments. For shipowners not intending to return their fleets to China, cargoes to the Persian Gulf and India are becoming less attractive.

Israeli ports continue to accept vessels. Most terminals have not suspended operations despite ongoing hostilities.

At the same time, the ports of Haifa and Ashdod have stopped accepting dangerous cargoes, and freight rates for tonnage bound for Israel have risen. Against this backdrop, cargo volumes from Turkey to Israel have fallen by more than 50%. Turkish experts forecast a significant disruption to international logistics, as the Port of Haifa is a key regional transshipment hub. It handles flows from Asia to Europe, and Turkey uses it to transport its goods to external markets.

Sincerely, Konstantin Grinevich and Glogos Project