India: Coal freight rates drop for first time amid ongoing volatility since start of Iran-US conflict

• Soft coal demand pressures Panamax, Supramax segments
• Bunker volatility disrupts fixing, limits market activity

Dry bulk coal freight rates to India remained under pressure this week, amid fluctuating bunker prices, limited fixtures, and cautious market sentiment. While rates stayed elevated, slight corrections were seen across key routes due to softer crude and weak trading activity.

Market participants highlighted persistent uncertainty, with fuel volatility continuing to disrupt fixing activity. “The market remains volatile, with minimal fixtures as participants struggle to align on workable levels,” a ship broker said.

Sentiment turned slightly bearish during the week, with easing crude offering limited relief. “Rates have softened marginally, reflecting weaker momentum,” another broker said.

A charterer noted, “Bunker volatility is impacting deals — we are negotiating but unable to fix.” Market participants highlighted a widening gap between buyer and owner expectations.

Across vessel segments, activity stayed muted with slight softening in Panamax, Supramax, and Handy segments, as most players adopted a wait-and-watch approach.

“Freight is correcting with softer crude, but volatility may persist amid ongoing uncertainties,” another broker added.

Route-wise updates

Why coal freight rates dropped

• Bunker price volatility: Prices declined by $144/t w-o-w to $859/t on 27 March, though remained volatile amid fluctuating crude oil trends and uncertain market sentiment.
• Baltic index falls w-o-w:  The Baltic Index decreased by 43 points w-o-w to 2,014 on 26 March, with declines in Panamax, which fell by 139 points to 1,770, and Supramax, which dropped by 24 points to 1,205, amid softer coal and minor bulk activity.
• DCE coke futures drop w-o-w: Coke futures on the Dalian Commodity Exchange decreased by around RMB 60.5/t ($8.75/t) w-o-w to RMB 1,752/t ($253.49/t) on 27 March, supported by steady steel production, restocking by mills, and firm raw material costs, which lent support to market sentiment.
• Brent crude futures surge w-o-w: Brent crude oil futures rose by around $2.8/bbl w-o-w to $110/bbl (May 2026 contract) on 27 March, supported by ongoing geopolitical tensions and supply concerns.

Outlook

Coal freight rates to India are likely to remain volatile, with bunker price movements and limited fixtures continuing to influence sentiment. While easing crude may cap further upside, ongoing uncertainty and cautious market participation could keep rates range-bound.