[ad_1]
The Breakwave Dry Bulk Shipping ETF (BDRY) increased by 6% this week and closed at an all-time high. Sentiment ended up improving significantly after Monday’s sudden Evergrande-related panic. As we discussed in our client note on Monday, sentiment in the dry bulk market and related commodity markets (as well as in the global equity markets at large) suddenly became very bearish on Monday due to Evergrande concerns — but actual dry bulk freight rates all climbed higher that day. As we stressed at the time, the Evergrande issue was not having any impact on dry bulk spot fundamentals, and this remains true today. Major global iron ore exporters continue to ramp up production and sell their cargoes, China has continued to purchase cargoes at much lower prices than just a few weeks ago, and the spot supply/demand vessel balance remains very tight.
Our upcoming Weekly Dry Bulk Report will also discuss various other developments including the Chinese government not wanting to compete with other consumers for thermal coal. As we have continued to stress in our Weekly Dry Bulk Reports and Weekly China Reports this year, China’s reliance on thermal coal has only continued to grow. So far this year, thermal coal-derived electricity generation has contributed to 72.1% of China’s total electricity generation. During the same period last year, it contributed to 71.3% of total electricity generation.
Source: Commodore Research & Consultancy
[ad_2]
This article has been posted as is from Source