+380 67 625 91 65The Black Sea freight market remains low-active. A decrease in cargo volumes from Ukraine and other ports in the region is seriously affecting transportation dynamics. The main demand is concentrated on grain transportation, but wheat and corn exports remain at minimal levels. These forces shipowners to accept rates lower than expected. Even traditionally popular routes, such as shipments to the Mediterranean Sea, are losing their activity due to general economic instability and decreased interest from importers. Against this background, Charterers are actively dictating terms, minimizing rates on major routes. In response, shipowners try to avoid idle time by redistributing vessels to neighboring regions, but such measures only partially compensate losses. Prospects of recovery remain uncertain, especially on the threshold of long holidays and a decrease in trade activity.
The Mediterranean Sea also presents difficulties for shipowners operating with small tonnage fleets. Cargoes such as fertilizers, steel and raw materials continue to be transported, but their volumes are insufficient to stabilize rates. High competition among shipowners allows charterers to conclude contracts at terms significantly below market. To avoid idle time, many shipowners are forced to make concessions, realizing limited prospects for improvement of the situation in the near future. Even previously active routes, such as transportation from Egypt to Turkey or from North Africa to Europe, are experiencing a decline due to weak demand. Additional pressure on the market is exerted by the holiday season, which reduces trading activity. In the coming weeks, shipowners in the region will face increased competition for limited cargo volumes, which may lead to further decreases in rates.
The Azov Sea market also remains under serious pressure. Weather conditions in the region aggravate the situation, causing delays in the Kerch Strait, where hundreds of vessels are piling up. However, even such factors do not contribute to the growth of rates, as the volumes of grain and coal exports from Russian ports are extremely low. Charterers continue to offer minimal rates, which reflects weak demand for transportation. Grain delivery to Turkey remains the main direction, but even here volumes remain small, and rates barely cover shipowners’ operating expenses. In order to minimize losses, shipowners accept extremely low rates, realizing that the situation is unlikely to improve in the coming weeks. Long-term prospects of this market will depend on the recovery of demand for grain and coal from Turkey and other countries in the region.
