For the month of November there was no real market for large ships - neither was there demand, nor were there issues with over or under supply. Vessels were either ensnarled in the congestion off Mersin or positioning to Chile for the start of the deciduous fruit season.
In contrast, the market for small tonnage was vibrant and forecast to remain so. This is largely because it is (currently) more difficult to containerize the demand drivers that make the market for the smaller units. After a relatively lacklustre year to the end of October, there was sufficient demand from a number of fish and potato cargo sources throughout the month to cause a shortage of capacity, which allowed operators to drive rates northwards.
Unusually for the time of year, there were reasons to believe that the imbalance in capacity (in favour of operators) would be maintained until early to mid January. Ordinarily at this time of year trawlers would be returning to port for the festive break, charterer demand would slow and rates would ease. If the projections made at the start of December are accurate, the opposite will be true. And if units are then absorbed into the South Atlantic squid trade, the market will stay firm well into the New Year.
Despite the amount capacity being redelivered onto the market at the start of 2017 as a result of charterers switching modes, there were no immediate signs that vessel owners were planning to demolish tonnage. If the early indications are that demand in 2017 is to remain as weak as it was throughout 2016, this will change, particularly if oil prices trend higher.
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