West Australian iron ore shipments gather pace
- Iron ore liftings from the major shippers in Australia have made a strong start to the month, averaging just over 3 MMT per day.
- This daily volume is about 11% higher than May’s average.
- If shipments sustain this pace through June, then volumes for the month will reach around 76.6m tonnes, up by 4.4% MoM and the highest monthly total since December last year, but still down by 4.6% versus June 2020.
- The uptick in shipments is likely in part down to extremely strong iron ore prices, which continue to hover above the $200 per tonne mark.
- But for some of the miners operating in the country, the approaching Australian financial year-end provides an extra incentive to book in sales at these prices and boost revenue.
- We expect volumes to remain strong over the coming weeks as Chinese demand shows little sign of waning in the short-term.
Shipments of forest products hits new monthly highs in May
- Forest product shipments totaled 10.8 MMT in May, rising 17% YoY and the highest monthly total on record.
- This figure includes logs and semi-processed goods such as timber and woodchips.
- Log shipments in May totaled just over 3 MMT, rising 9% MoM as producers take advantage of rising timber prices.
- The front-month timber contract on the CME hit high all-time highs in May at $1,686/t, over 400% higher YoY.
- Shipments in June are currently on track to set another record, averaging over 0.4 MMT per day, which would translate to an estimated 12.4 MMT shipped this month, 34% higher YoY.
- Liftings in Vietnam and Brazil were particularly strong, rising 51% and 34% YoY.
- Higher volumes in May saw Ultramaxes shipments of these goods increase 60% YoY to a new monthly record of 1.1 MMT.
Brazilian dry bulk imports set new record
- Brazilian dry bulk imports hit new monthly highs in May at 7.7 MMT, 21% higher YoY, and 28% higher than the 5-year average for this time of year.
- Volumes were boosted by record steel imports in May of 0.6 MMT versus only 24k tonnes a year ago.
- Industrial activity has picked up in the Latin American giant in recent months, with the country’s economy recovering to pre-pandemic levels in Q1 2021, according to Reuters.
- Supramaxes have enjoyed the majority of the added demand from Brazil with arrivals of the 40-64k dwt vessels also at its highest monthly total on record in May at 3.5 MMT, 32% higher YoY.
- Supramax coal imports in particular also saw their strongest month on record at over 0.6 MMT, 69% higher YoY.
- Weak rainfall in large parts of the country may have forced electricity producers to substitute in coal as a means of power.
- The Supramax market has remained hot relative to the other ship types in recent weeks, as these niche trades continue to outperform.