Toepfer Transport: high bunker prices cut short sea vessel earnings
The European short sea fleet has seen its income dip during the month of March as high bunker prices could not be fully passed on to shippers. The Hamburg-based shipbroker, Toepfer Transport noted that while the freight rates are maintaining strong levels, the effects of the war in Ukraine is reflected in March time charter equivalents.
In its latest monthly report, Toepfer Transport noted that the short sea freight rates are still keeping their firm levels however the spike in oil and bunker prices as result of the Ukraine war finds reflection in time charter equivalents achieved in March.
In March 2022, the average rate for 3,200-3,800 dwt vessels stood at €6510, while 4,800-5,600 dwt vessels were chartered for an average day rate of €8059.
March 2022 rates for the 3,200-3,800 dwt vessels slipped 8.44 percent from the previous month’s levels. TCE equivalent for 4,800-5,600 dwt vessels slipped down 11.22 percent from the previous month. Compared to March 2021, day rates for 3,200-3,800 dwt vessels were up 67.52 percent while day rates for 4,800-5,600 dwt vessels operating in the European short sea market have increased 72.39 percent.
“Higher voyage related cost that could not be passed on to shippers in full, have reduced vessels’ income by around 10 percent on average compared with February earnings. Cargo owners are trying hard to push down freight and charter rates but tight tonnage supply does not support significant rate reductions,” Toepfer Transport’s report reads.