Capesize freight rates rebound on better shipping demand in the Pacific which improved overall market sentiment.
Thus, the Capesize 5 time charter average rose by $328 day-on-day to $16,289 on Monday, with improved bids that boosted the paper market.
The Baltic Dry Index (BDI) reflected the market optimism and posted gain of 1.39% or 18 points day-on-day to 1,314 readings.
Steady gains in the Pacific
Shipping demand remained healthy in the Pacific market with fixtures done at higher rates as all three mining majors were active in the market.
However, some trade participants were heard to stay at the sideline in waiting for clearer market direction ahead of the Golden Week holiday in China at early October.
According to some trade sources, the iron ore shipping demand may fall in coming weeks, following the narrowing steel margins and slow steel demand in China.
Meanwhile, there was still a standoff between owners and charterers at the Atlantic market that subdued freight rates.
However, most trade participants were bullish on the Brazil to China route due to the clearing up of the lengthy ballast list.
VLSFO prices dip from higher crude supply
VLSFO prices dropped sharply by $8/mt day-on-day to $335/mt in the port of Singapore, on lower bunker demand and recent downward movement of crude prices.
Crude oil prices took a dive as Libya tried to restart its oil production and resumed exports since the blockade in January. Currently, the country’s oil production recorded at 100,000 bpd, down from previous 1.2 million bpd since the start of the year.
The increased production was on contrary to OPEC + efforts of output cut and destabilized the supply and demand of oil amid the coronavirus pandemic.