The need for more energy to offset the winter seems to have pushed the rates further for the Shortsea Multi-purpose vessel segments. The TSI-35 which depicts the time charter equivalent earnings for the 3,200-3,800 deadweight vessel category rose to USD 4,744.
The rates have gained by 32% over the past four months, indicating an eight-month high. The TSI 52 which depicts the time charter equivalent earnings for the 4,800-5,600 deadweight vessel category rose to USD 5,918. These rates are again at an eight-month high, having gained 23% over the past four monthly quotes.
Despite rising volatility in the global ocean freight owing to geopolitical conflicts and tensions, along with the fact that inflationary pressures can re-arise owing to the induced effect, the seasonal autumn rises reversed the fall in the shortsea market. The energy demand for the winter could keep the rates above, however, productivity in the Europe manufacturing sector will still dictate the terms. The European PMI (Price Manufacturing Index) seemed to have put an end to the business downturn recording 46.60 in January 2024, with estimates pointing out to a number of 47+ by end of Q1, 2024. The number was lower at 44.40 in December 2023 and the 5% rise coincides to the best ever number for the manufacturing sector in nearly 10 months.
The Shortsea rates are expected to be on the higher side. Of late, the Drewry Multipurpose Time Charter Index too has remained stable owing to the cushion from the smaller vessel markets.
Author of the article: Gautham Krishnan
Gautham Krishnan is a logistics professional with Fluor Corporation, who has expertise in the Supply Chain area focusing in the Project Logistics domain, analytics and the LogTech space. He has worked in the areas of Project Management, Business Development and Government Consulting. For his body of work in the mentioned areas, he was bestowed the AntwerpXL 40-under-40 award in the year 2023, and touted to be one of the upcoming, future leaders in the project logistics & supply chain function.