Capesize bulk carrier earnings are closing out the year with a rare burst of strength, climbing to levels not seen since 2022. Daily spot rates jumped by more than $6,000 in the latest session, pushing toward $45,000 as tightening vessel availability and robust long-haul trades buoy the market across major basins.
The rally comes despite lacklustre conditions in global steel. World output is down 1.5% year-on-year, and Chinese production has slipped 4%. Even so, iron ore shipment volumes are on the rise. According to investment bank Jefferies, declining ore output at Chinese mines has increased the country’s dependence on seaborne cargoes. On a ton-mile basis, capesize demand is up 8% through November—far ahead of the fleet’s roughly 2% growth this year.
Shifts in global trade patterns are also reshaping the segment. West Africa has solidified its position as a third major capesize loading hub alongside Australia and Brazil. Jefferies reports that a mix of long-haul Brazilian iron ore and expanding West African bauxite exports has lifted total capesize loadings by 5% this year, while Australian volumes have held steady.
Future supply dynamics could tighten the market further. Guinea’s vast Simandou development—designed to produce 120m tonnes of iron ore annually—is expected to significantly boost long-haul tonnage demand once it ramps up. Jefferies forecasts that capesize demand could increase by around 6% in both 2026 and 2027 if Simandou output adds to global trade, or 4% if it mainly replaces Australian shipments. With fleet deliveries projected just under 3% per year over the same period, utilisation could climb from 84% in 2025 to about 90% by 2028.
Reflecting these shifts, Jefferies has sharply upgraded its capesize earnings outlook. The bank now projects average rates of $27,500 per day in 2026, rising to $30,000 in 2027 and $32,500 in 2028—well above its earlier flat forecast of $22,500 a day.
The bank also suggested that a long-quiet market trend may be re-emerging: larger vessels outperforming smaller bulk carriers, mirroring the recent strength seen in the VLCC segment of the tanker market.
