The overthrow of Guinea’s government on Sunday has some stakeholders in dry bulk shipping quite concerned, while others aren’t that worried at all. Special armed forces within the world’s largest bauxite exporter stormed the country’s capital Conakry and ousted Alpha Conde, its president for the last 11 years. The capesize 5TC, a spot-rate average weighted across five key routes, has fallen 9.5% over the past two days to $42,200 per day on Tuesday, according to Baltic Exchange data.

The paper market has rebounded after pulling back on Monday. The forward freight agreement rate for the fourth quarter improved 3.2% on Tuesday to $34,263 per day. “Whenever you have such breaking geopolitical news that is tight to shipping, it is natural to be concerned on any potential disruption,” John Kartsonas, founder of asset-management advisory firm Breakwave Advisors, told TradeWinds. “Guinea bauxite exports occupy some 5% of the global capesize fleet, which is meaningful and much higher than a few years back.”

The political upheaval could hurt capesize freight rates and tonnage demand by disrupting Guinea’s bauxite volumes and forcing major importer China to scour the globe for the commodity, Breakwave Adivors shipping economist Ulf Bergman wrote in a note. “However, if Chinese buyers are successful in sourcing replacement volumes elsewhere, such as Indonesia and Australia, some of the tonnage demand could on the other hand shift to the panamax segment,” he wrote. The panamax 5TC slipped 3% over the past two days to $31,468 per day on Tuesday.

Diana Shipping has fixed the 77,525-dwt panamax Crystalia (built 2014) from 19 September to at least 1 October 2022 at $26,100 per day with Uniper Global Commodities. But the coup has resulted in mostly handwringing across dry bulk shipping and should not have any meaningful impact on the long-term market, said Jeffrey Landsberg, managing director of Commodore Research. “Overall, any new government, regardless of if it has come into power by force, desires to keep bringing in revenue, and the new Guinea government is no different,” he told TradeWinds. “The situation in Guinea of course is still in flux, but for now it appears that no major changes in bauxite production and exports are likely to occur.”

Guinea’s total bauxite exports last year reached about 85m tonnes and accounted for almost half of China’s bauxite imports, Bergman wrote. The overthrow has left 14 bulkers, including eight capesizes, waiting for bauxite off Guinea, amid a slight disruption to bauxite production, according to Arrowhead Shipbroking Group. But Stamatis Tsantanis, chief executive of capesize pureplay owner Seanergy Maritime Holdings, expects the country will continue exporting bauxite at normal levels very soon. “I am not concerned about the situation in Guinea,” he told TradeWinds. “If there would be any disruptions, it would be temporary.”

Noble Capital Markets analyst Poe Fratt said any change in Guinea’s bauxite shipments could be negative to dry bulk shipping, but rates will probably be more impacted by disruptions to grain shipments out of hurricane-stricken New Orleans. “It is often volatile, but it seems like the dry bulk market is factoring in potential negative news quickly and looking for a reason to correct form very high rates,” he told TradeWinds.