Dry bulk freight rates will recover from abysmal levels and are likely to see better conditions than many in the market have forecast, shipper Golden Ocean said.

"Everyone agrees that we have got a period of about 18 months that will be a bit difficult, but there is much that points to a market that won't be as bad as expected," Chief Executive Herman Billung told Reuters.

Floods in Australia and the Japanese tsunami, combined with an influx of newbuilds in the market, have driven down the Baltic Dry freight rate index to 1,414 points this year from 2,678 points in late October of last year.

"In many ways I feel the headlines have been a bit too negative compared to reality, since many focus on the (large) Capesize ships, while rates have actually held up surprisingly well for smaller ships," Billung said. (Reuters)