March 20 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, rose on Tuesday as higher rates for smaller vessels countered weakness in capesizes.
The overall index, a gauge of the cost of shipping commodities such as iron ore, cement, grain, coal and fertiliser, climbed 5 points or 0.57 percent to 884 points.
The Baltic's capesize index slipped 33 points or 2.28 percent to 1,416 points, lows not seen in a year.
"Capesizes were under renewed pressure from curtailed activity due to the Australian cyclone last week and still constrained exports out of Brazil," RS Platou Markets analyst Frode Morkedal said.
Average daily earnings of capesizes, which usually transport 150,000 tonne cargoes such as iron ore and coal, were down $307 at $4,881, a drop of more than 84 percent this year.
A comment by BHP Billiton comment on Tuesday that it was seeing signs of flattening iron ore demand from China also weighed on sentiment. Iron ore shipments account for around a third of seaborne volumes on the larger capesizes.
"While we think China will still be the main driver for the dry bulk market, a deceleration in growth of steel production has been largely expected as governmental bodies are pressing hard for phasing out obsolete capacity and consolidation of smaller mills," Arctic Securities analyst Erik Nikolai Stavseth said in a note.
Morkedal said rates for capesizes could bottom out in the near term at current levels as fixture activity picks up after the cyclone and with the resumption of a closed Brazilian rail link.
The main index, which factors in the average daily earnings of capesize, panamax, supramax and handysize dry bulk transport vessels, is down 49 percent this year.
The Baltic's panamax index climbed 1.41 percent, with average daily earnings rising to $8,037. Even so, earnings for panamaxes, which usually transport 60,000 to 70,000 tonne cargoes of coal or grains, have fallen 39 percent this year.
Average daily earnings for handysize and supramax ships were up at $7,915 and $10,340, respectively.
Supramax rates are at two-month high, helped by the grain season in the Atlantic and strong activity in the Pacific for coal, iron ore out of India and nickel ore. (editing by Jane Baird)