SunSirs: China Coastal (Bulk Cargo) Shipping Market Analysis Report

In November, the anticipated increase in electricity demand for winter heating is expected to boost coal storage demand. Shipowners are showing strong willingness to hold prices, leading to a significant rise in the composite index. On November 28, the Coastal (Bulk Cargo) Composite Freight Index released by the Shanghai Shipping Exchange closed at 1171.03 points, up 1.6% from the end of the previous month. The monthly average stood at 1216.18 points, representing a month-on-month increase of 9.2%.

1. Coal Transportation

On the demand side, as cold air activity becomes increasingly frequent, heating supply is starting to expand across northern regions, driving up expectations for winter heating energy consumption. As a result, most power plants are proactively replenishing their coal stocks in advance. However, procurement is primarily focused on long-term contract coal and cost-effective imported coal, with only essential purchases made of higher-priced market coal. Daily coal consumption at power plants in the eight coastal provinces has reached 1.838 million tons, and the number of days’ worth of coal reserves available has increased. In terms of freight rates, supported by growing demand for electricity and coal used for winter heating, end-users are more actively dispatching vessels northward, leading to frequent ship-cargo transactions. Yet, due to issues with the structure of coal supplies, there are instances of ships waiting for cargoes, which somewhat restricts the smooth flow of goods. The process of end-user inventory replenishment is slightly lagging behind, and while shipowners and cargo traders remain highly active in negotiations, buyers’ price acceptance is gradually declining. Market sentiment is becoming increasingly cautious, causing coastal coal freight rates to first rise and then fall.

On November 28, the Coal Freight Rate Index released by the Shanghai Shipping Exchange closed at 1,204.4 points, up 0.9% from the end of the previous month. The monthly average stood at 1,271.34 points, representing a month-on-month increase of 11.3%. On November 28, according to the China Coastal Coal Freight Index (CBCFI) released by the Shanghai Shipping Exchange, the market freight rate for the route from Qinhuangdao Port to Zhangjiagang (40,000–50,000 dwt) was 35.4 CNY per ton, down 5.9 CNY per ton from the end of the previous month. The monthly average was 44.9 CNY per ton, up 7.1 CNY per ton month-on-month. For the South China route, the market freight rate for the route from Qinhuangdao Port to Guangzhou (60,000–70,000 dwt) was 43.6 CNY per ton, down 5.6 CNY per ton from the end of the previous month. The monthly average was 50.7 CNY per ton, up 4.8 CNY per ton month-on-month.

2. Metal Ore Transportation

This month, global shipments of iron ore remained at a high level, with significantly increased arrivals at ports, a slight rebound in outbound shipments, and a small accumulation of port inventories. In the shipping market, as downstream users had already booked vessels earlier to consume part of the available capacity, the market faced tight supply, and shipowners showed strong resistance to price reductions, leading to a substantial rise in coastal freight rates for metal ores. As of November 28, the freight rate index for metal ores closed at 1,126.79 points, up 3.5% from the end of the previous month. The monthly average stood at 1,143.68 points, representing a 7.5% increase compared to the previous month.

3. Grain Transportation

This month, downstream procurement and transportation activities have been vigorous, leading to a significant increase in coastal grain freight rates. As of November 28, the grain freight rate index closed at 1,283.4 points, up 3.9% from the end of the previous month. The monthly average stood at 1,333.53 points, representing a month-on-month increase of 18.2%.

4. Crude Oil and Refined Oil Transportation

This month, international crude oil prices experienced slight fluctuations, while domestic refined oil prices remained stable. The pace of transportation demand stayed unchanged, resulting in a modest rise in coastal refined oil freight rates. As of November 28, the refined oil freight rate index published by the Shanghai Shipping Exchange was 1,345.39 points, up 2.1% from the end of the previous month; the crude oil freight rate index was 1,616.4 points, up 0.4% from the end of the previous month.

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