Capesize rates reversed into losses after sluggish start to the week with little shipping activities.
Thus, the Capesize 5 time charter average dropped by $616 day-on-day to $24,469 on Monday, due to the subdued Pacific and Atlantic market.
The Baltic Dry Index (BDI) then followed the dip and slipped by 1.87% day-on-day to 1,678 readings at the start of the week.
More tonnage supply after crew replacement
There was more vessel supply in the market after the crew replacements that resulted in less support for freight rates.
Some participants were also doubting if the high demand for iron ore was enough to sustain the recent rally in the freight market, as more vessels were being released from China over the weekend.
Meanwhile, there was little fresh activity in the Atlantic market and there remained a standoff between owners and charters over freight rates.
Bunker prices drop on higher supply
VLSFO prices continued its downward movement due to concern over oil demand amid rising coronavirus cases.
Thus, the VLSFO prices dropped slightly by another $0.50/mt to $335/mt at the port of Singapore.
Bunker prices were also affected by higher bunker production as most oil suppliers are expected to ease their output cut and ramped up production in August.