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March 03, 2022

FreightSigns

What is the goods traffic, and the free cash flow of fleet operators, telling us?

Fleet utilisation flat; freight rates slip

 

Fleet utilisation levels were flat on-month in February 2022, as improving utilisation of bulk commodities such as steel, and auto carriers and petroleum tankers was negated by lower utilisation levels for agri products, and in mining activities and cement transportation. This impacted freight rates, which dipped marginally, despite flat diesel prices.

Decadal capex cycle

Aggregated decrease in freight rates was ~1% on-month, with slight decrease in rates on most routes. On 5-7% of the routes, though, there was no change in freight rates.

Decadal capex cycle

CRISFrex declined slightly on-month, with free cash flow (pre-equated monthly instalment) mirroring the trajectory. Flat utilisation levels exerted pressure on freight rates, constraining transporters’ ability to generate higher cash flow.

Decadal capex cycle
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