Capesize freight rates bounced from the recent slump and pushed up significantly on good shipping demand.
As such, the Capesize 5 time charter average jumped by $1,140 day-on-day to $17,229 on Tuesday, with the September and October contracts making big gains.
The Baltic Dry Index (BDI) chased the rally and saw gain of 3.81% or 50 points day-on-day to 1,364 readings.
Higher freight for both basins
The bullish paper market was due to the improvement in both the Pacific and Atlantic markets that pushed up for higher freight rates.
However, some trade participants were disappointed by limited fixtures in the Pacific market due to a standoff between ship-owners and charterers.
Nevertheless, there were fresh new shipping inquiries for the west Australia to China routes that supported better rates.
Meanwhile, more fixtures were seen in the Atlantic market with freight indicated on the Brazil to China route for second-half October laycan trading at the low-$17s/wmt to high-$17s/wmt level.
VLSFO prices stay flat amid market uncertainty
VLSFO prices stayed flat at $332/mt in the port of Singapore, due to market inactively as trade participants tried to digest the recent choppy price movement.
Some trade participants were concerned over lower oil demand as some European nations had renewed their lockdown measures to contain the pandemic.
In the meantime, China seemed to slow down its bottom-fishing for cheap crude oil imports after August and thus providing less support for oil demand in September.
Previously in August, China had stocked up an estimated 1.1 million bpd of crude oil for strategic reserves, lesser than the 1.92 million bpd in July and much lower than June’s imported volumes at 2.77 million bpd.