This time last year, seasonal optimism proved elusive for the Panamax segment. The Baltic Dry Index closed at 1,537 points, a level at odds with the bullish sentiment that traditionally accompanies the onset of winter grain and coal demand. Rather than a surge in fixing activity and rising rates, the market drifted downward, seemingly searching for a floor. Panamaxes were particularly hard hit, finishing the week with an average time-charter equivalent of $9,747 per day – the lowest since August 2023. Even core routes, such as the P6_82, slipped below the psychological $10,000 threshold. On the Atlantic side, sentiment deteriorated visibly, illustrated by reports of a grain house securing four Kamsarmax vessels at an APS-equivalent of $8,500 on the P6 route, highlighting the extent of market distress. The weakness in freight mirrored broader shifts in global agricultural trade flows. China absorbed a record 104.75 million tonnes of soybeans between October and September, but much of that volume originated from Brazil, not the U.S. Brazilian exporters surged ahead, benefiting from competitive pricing and favourable crop conditions, while U.S. suppliers were sidelined. Corn flows were equally divergent: U.S. exports reached a five-year high, Argentina posted a 33 percent year-on-year increase, yet Brazil’s shipments began collapsing under poor crop performance and diminished Chinese demand. Consequently, last year’s forty-seventh week painted a picture of a Panamax market squeezed between soft demand and evolving sourcing patterns – a period defined more by contraction than the seasonal rally many had expected.
Fast-forward to today, and the Panamax market has undergone a striking transformation. The Baltic P5TC weighted average currently stands at $17,354 per day, while the P6_82 route has strengthened to $16,313 – substantially higher year-on-year. The second half of this trading year has brought the momentum that was absent twelve months ago, driven by a broad-based recovery in grain and coal shipments and a general rebound in tonne-mile demand across both the Atlantic and Pacific. The improvement is not coincidental. China’s renewed appetite for seaborne coal, Brazil’s robust export programme, and rising energy and feedstock demand across Southeast Asia have injected optimism into the market. While volatility remains, fundamentals have markedly improved, underpinned by stronger cargo flows and tighter vessel availability.
In the Pacific basin, Panamax activity has been powered overwhelmingly by China’s re-acceleration of coal imports. Thermal power generation jumped 7.3 percent year-on-year in October, reaching 513.8 billion kWh – a record for the month. Hydropower additions provide limited relief as wind and solar outputs decline seasonally, leaving coal as the dominant fuel to meet winter demand peaks. Domestic coal production, meanwhile, has been constrained by Beijing’s output restrictions. October output fell to 406.75 million tonnes, down both month-on-month and year-on-year, tightening the domestic supply. Against this backdrop, seaborne imports have begun to play an increasingly critical role. For the first nine months of 2025, China’s coal imports were down 11 percent year-on-year to 345.89 million tonnes. However, September arrivals jumped to a nine-month high of 46 million tonnes, driven by rising domestic prices and the competitiveness of imported cargoes, though still slightly below year-ago levels. October imports of 41.74 million tonnes were down 9.8 percent year-on-year but substantially higher than six months prior, reflecting the seasonal demand rebound. With coastal stockpiles estimated below previous November levels, seaborne coal demand is expected to remain resilient throughout the winter, especially if domestic output remains constrained. The effect on Panamax freight has been immediate: coal stems were filling vessel schedules at a pace not seen in multiple quarters, while cross-Pacific agricultural and mineral flows were also contributing to robust vessel utilisation. The firmness of Pacific demand has been, therefore, broad-based rather than narrowly tied to coal alone.
Meanwhile, the Atlantic basin has returned to the forefront of Panamax activity, driven primarily by soybean and soymeal exports from Brazil. From April through October, Brazil’s shipments demonstrated a mix of seasonal moderation and structural growth. April exports reached 15.27 million tonnes, buoyed by strong Chinese demand and favourable logistics. May moderated to 14.1 million tonnes – a 7.84 percent month-on-month decline – but remained 5.22 percent above May 2024 levels, with cumulative exports for January-May at 51.6 million tonnes, up 2.88 percent year-on-year. June saw shipments of 13.4 million tonnes, down 4.9 percent from May, yet cumulative first-half exports totaled 65 million tonnes – the highest in five years and a 1.3 percent increase versus 2024. July shipments declined to 12.3 million tonnes, an 8.21 percent month-on-month drop, but volumes were 9.8 percent higher year-on-year. August exports fell sharply to 9.3 million tonnes, down 24.39 percent from July, though year-on-year growth remained 16.25 percent, with cumulative exports at 86.6 million tonnes. September shipments decreased to 7.3 million tonnes – a 21.51 percent month-on-month fall – but year-on-year growth persisted at 19.67 percent, bringing cumulative exports for the first nine months to 93.9 million tonnes. October exports of 6.7 million tonnes represented a multi-year high for the month. While the typical seasonal slowdown is evident, the overall trajectory underscores Brazil’s position as the world’s leading soybean exporter, with strong global demand, record crop production, and shifting trade patterns supporting sustained Panamax activity.
Conversely, U.S. soybean exports have remained largely muted this year, though the past week saw the largest sales to China in over two years. Confirmed purchases of nearly 1.6 million tonnes over three days pushed U.S. prices sharply higher, creating a premium relative to Brazilian shipments. Even if these purchases fall short of the 12 million tonnes previously targeted, any increase in trading activity is always welcome. However, the market is navigating a delicate balance: Beijing does not currently require additional U.S. beans, given substantial South American arrivals, and will need to draw down national reserves to accommodate incoming shipments.
The Panamax market has now clearly shifted from last year’s subdued conditions toward a phase of renewed activity and firmer underlying fundamentals. Pacific demand is being anchored by China’s heightened coal import requirements and persistent thermal power needs, while Atlantic momentum is supported by strong Brazilian soybean exports and the recent re-emergence of U.S. purchases. Looking ahead, the interplay between resilient Asian energy demand, sustained South American agricultural exports, and measured U.S. trading activity suggests that Panamax tonnage should remain well-supported into winter, even if volatility continues to shape weekly sentiment. There is cautious optimism that, provided commodity flows across both basins remain broadly intact, the segment is positioned to maintain a constructive tone into the new year, potentially delivering higher seasonal lows during what is typically the weakest first quarter.
Data source: Doric