Number of idle ships down to around 15, from 70 in early 2016 - broker.
Freight rates for large capesize dry cargo ships on key Asian routes could nudge lower next week although they are generally expected to remain around the current levels, ship brokers said.
"Owners still have confidence in the market," a Shanghai-based capesize broker said on Thursday.
That was reflected through the number of idle capesize ships, which were down to 15 vessels this week, the broker said. That compared with around 70 at the beginning of this year when daily charter rates were less than the operating costs.
"I think rates will remain above $4 per tonne for Australia, and $9 or $8.80 a tonne from Brazil," the broker said.
Owners were rejecting bids from charterers of $8.80-$8.90 per tonne on Thursday, the broker added.
Iron ore, coke and coal prices surged in China on Thursday, fuelled by a rise in steel futures, following three days of losses.
This could drive increased chartering activity by miners although the market had yet to react on Thursday, the Shanghai broker said.
Iron ore and coal are the staple cargoes for 180,000-deadweight tonne capesize bulk carriers.
Rates slipped this week even though all the major miners - Rio Tinto, BHP Billiton, Fortescue Metals Group and Vale - were active in the market, brokers said.
"It just seems that the fundamental problem of the industry continues to prevail, that there is simply too much tonnage," Norwegian ship broker Fearnley said in a note on Wednesday.
Capesize charter rates for Western Australia-China fell to $4.20 a tonne on Wednesday, the lowest since May 26, against $4.56 per tonne last week.
Freight rates from Brazil to China hit a one-month low of $9.04 per tonne on Wednesday, compared with $9.38 per tonne the previous week.
Charter rates for smaller panamax vessels for a North Pacific round-trip voyage were close to the highest in nearly a year on Wednesday at $6,938 per day, up from $5,822 per day last Wednesday.
They hit $6,941 per day on Tuesday, the highest since July 29, 2015.
"Specific trades been paying a premium due to lack of prompt tonnage. We believe grain (from the east coast of South America) will be the driver in the coming week," the Fearnley note said.
Freight rates in the Far East for smaller supramax vessels have remained stable this week, while price levels vary depending on the type of cargo, brokers said.
Supramax vessels were fixed at $7,500 per day for (a coal) trip from Singapore to China via Indonesia, while daily rates for nickel ore cargoes are $1,000-$2,000 higher, Fearnley and ship broker Banchero Costa said.
The Baltic Exchange's main sea freight index climbed to 736 on Wednesday from 726 last week.
Source: Hellenic Shipping News