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Strong Bulk Movements Drive Up Ocean Freight Rates

Increase was partly due to strong trading of bulk commodities

According to the latest USDA Grain Transportation Report, during the third quarter of 2019, ocean freight rates for moving bulk commodities, including grain, increased compared to the previous quarter, a year earlier, and the 4-year average.

The increase was partly due to strong trading of bulk commodities, especially firmness in India’s coal imports and surging iron ore exports from Brazil during the quarter.

Ocean freight rates for shipping a metric ton (mt) of grain from the U.S. Gulf to Japan averaged $50.05 during the quarter — 17% above the previous quarter, 11% above a year earlier, and 34% above the 4-year average.

The cost for shipping bulk grain from Pacific Northwest (PNW) to Japan averaged $27.90 per mt—18%, 12%, and 38% above the previous quarter, a year earlier, and the 4-year average, respectively.

Ocean freight for shipping bulk grain from the U.S. Gulf to Europe averaged $20.21 during the quarter. Although this is 3% below last year, it is 22% and 21% above the previous quarter, and 4-year average, respectively.

See the full report here.

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