June 11 (Bloomberg) -- The cost of shipping iron ore rallied the most in more than a month amid speculation that a slowdown in record fleet growth is helping owners to negotiate better charters.
Rates for Capesizes transporting 150,000 metric tons or more of the steelmaking commodity rose 4.1 percent to $5,797 a day, the largest one-day advance since May 7, according to the Baltic Exchange in London. The Baltic Dry Index, a wider measure of freight prices, gained 1.2 percent to 825 points.
The fleet of Capesizes more than doubled between 2008 and last year after owners ordered more of the vessels than ever, according to data from Clarkson Plc, the world’s largest shipbroker. The growth rate will slow to 6 percent in 2013, about the same pace as demand for commodities including coal, iron ore and grains, according to the London-based firm.
“We are finally seeing low fleet growth,” Jeffrey Landsberg, managing director of Commodore Research, a New York-based adviser to ship owners, said by phone. “As the months progress, I think we will see even more of an effect, in a positive way.”
While holidays in China are curbing demand for vessels, bookings from outside the Asian country are gaining, he said. Rates for Capesizes are still below $7,758 a day, the amount owners need to cover operating expenses including crew and repairs, according to the most recent estimates from Moore Stephens LLP, a London-based consultant.
Three out of four vessel classes tracked by the Baltic Exchange gained. Panamaxes, with about half the capacity of Capesizes, rose 1.4 percent to $6,179 a day. Supramaxes, transporting about 52,000 tons, advanced 0.2 percent to $9,326. The only type to decline was Handysizes, the smallest. Rates for those fell $1 to $7,764 a day.
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