(Updated to include closing stocks prices throughout, as well as background on the dry-bulk shipping sector.)
NEW YORK ( TheStreet) -- Shares of dry-bulk shipping concerns advanced sharply Wednesday, gathering steam near the end of the session, as daily rates for their services continued to strengthen, pushed higher by China's demand for raw materials.
The going fee for a capesize vessel on the spot market, according to London's Baltic Exchange, the ship broker, jumped 4.6% to $67,385 Wednesday. That's down sharply from the more than $90,000 per day that these humongous ore haulers were fetching in July, but is still more than double the going rate of just two months ago. The Baltic Dry Index, which tracks the daily changes in rates for all sizes of drybulk carrier, from capesize on down, rose 3.7% Wednesday to 3,748.
The reason for the shipping-rates rally? The Chinese, of course, whose mills continue to churn out steel at a near-record pace. In October, according to data released by China's government Wednesday, the Chinese steel industry produced 1.67 million metric tons of the stuff per day, up 44% from the same period a year ago.Iron-ore imports, meanwhile, jumped 50% in October compared with a year ago, though the level did decline by about 30% from September's brisk pace. Nonetheless, with the world's third-largest economy growing, observers feel that ore imports will remain robust over the next month or so, especially as steel mills draw down further on the enormous ore stockpiles accumulated during a raw-materials buying binge in the spring and early summer of this year. Further evidence of the increasing demand for ore cargo space came Wednesday morning, when two capsizes were booked for routes between Australia and China at a rate of $17.50 a ton, up from $16.50 on Tuesday.