Capesize rates continued to race upward with better shipping demand in both basins, supported by the recent iron ore rally.
The Capesize 5 time charter average surged up by another $1,087 day-on-day to $9,142 on Wednesday, marking a rise throughout the week.
Likewise, the Baltic Dry Index (BDI) continued to hike and reached 764 points by Wednesday, up 7% and 50 points day-on-day.
Renew interests for Brazil to China route
Market sentiments had improved on the shipping demand out of Brazil after the recent concerns over the rising coronavirus cases and its effect on iron ore supply.
There was plenty of forward interests on Brazilian shipments as trade participants locked in first-leg cargoes on the paper market.
Some shipowners were also considering to ballast vessels toward Brazil as they expected Vale to catch up for the lower shipping volume earlier this year due to rainy season.
Pacific, the main driving force for freight market
Mining majors remained active in the key Western Australia to China route, as Rio Tinto, BHP and FMG were seeking vessels to move iron ore cargoes.
At least three vessels were fixed respectively by these three majors for west coast Australia to China route at freight rate of around $5.80/wmt, up 15 cents/wmt day on day for late June laycan.
The uptrend may have to do with Chinese end-users’ preferences for importing Australia medium grade ores due to the possible outages in Brazilian supply that made Brazilian ores more expensive.
Bunker prices gain despite flat crude oil movement
VLSFO gained by $7.50/mt day-on-day to $323/mt at the port of Singapore, due to market optimism of economics recovery from easing of lockdown measures.
Meanwhile, the oil crude prices continued to flatten, as Brent crude prices hovered at the $40 per barrel level, while the WTI maintained around the $38 per barrel level.
According to Fitch Ratings, the oil and gas industry were still on a long road to recovery, after the coronavirus pandemic and oil price crash wiped up an estimated oil revenue of almost $1.8 trillion this year.