Rates to ship iron ore rallied for a 10th day amid speculation traders are betting prices for the commodity used to make steel will rebound as Chinese mills replenish stockpiles.
Daily earnings for Capesizes hauling about 160,000 metric tons rose 10 percent to $10,306, according to the Baltic Exchange, the London-based publisher of shipping costs. That’s the highest since Dec. 10 and rates almost doubled since the start of the month, figures show.
Traders are booking more cargoes as prices end a slump, according to Ben Goggin, an iron-ore swaps broker at ICAP Plc in London. The benchmark price for the commodity at the Chinese port of Tianjin rose 2 percent to $120 a dry metric ton today after tumbling 24 percent since February, Steel Index Ltd. data show. Stocks at Chinese ports rose 6.5 percent to 70.6 million tons from a four-year low on March 8, according to Beijing Antaike Information Development Co.
“There’s some restocking ahead for some Chinese mills,” Goggin said by e-mail today. “Buyers may have jumped in and bought all the cargoes in the expectation they will be able to sell them at better prices in the coming weeks and that’s helped increase iron-ore prices and freight rates.”
The Baltic Dry Index, a broader gauge of commodities shipping costs, rose 3.4 percent to 995 today, the highest since Dec. 5, according to the exchange. Daily earnings for Panamaxes rose 1.9 percent to $7,240, and Supramaxes and Handysizes, the smallest ship types tracked by the index, each gained less than 1 percent to $9,510 and $8,036, respectively, data show.
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