For January and February 2021, official Chinese figure for coal production of 617.6 MMT, is up 26.3% and 20.2% on the comparable months for 2020 and 2019. The rise in coal production is attributed to China’s strong electricity consumption, which for January and February 2021 posted an increase of 21.0% and 13.2% on 2020 and 2019. The growth for the first two months of 2021 versus 2019 implies a CAGR of 6.4%, just shy of the 8.4% CAGR in electricity consumption for the ten-year period from 2009-2019. This is very much an indication of a V-shaped recovery, as China has managed to offset the losses from Covid-19. Thermal electricity consumption retained its market share, by posting an increase of 20.3% and 11.4% on 2020 and 2019. For January and February 2021, Chinese steel production was reported at 175.0 MMT, up 13.1% on the comparable months of 2020 and 17.0% on 2019 – underlining the contribution from China’s stimulus program. The strong economic activity in China is behind the recent strength in dry bulk markets.

Capesize rates are USD16.8k/day, more than 3x YOY and 2x the 2019-level. Even more strikingly, the smaller vessel sizes – which typically witness less volatile earnings than the Capesizes – are seeing stellar earnings coining anticipations of a “super cycle”. YTD Panamax rates are USD15.6k/day (92% above last four years average for Q1), YTD Supramax rates are USD15.3k/day (85% above) and YTD Handysize rates are USD13.1k/day (99% above).