Capesize freight rates hiked up on bullish shipping outlook with firm supports to set for another high rate for the year.
The Capesize 5 time charter average hiked up by $3,734 day-on-day to $33,066 on Friday, despite the absence of Chinese participants due to holidays.
The Baltic Dry Index (BDI) then went above the 2,000 readings and reached a one-year high points of 2,020, due to strong physical market.
Tight tonnage list pushes for better rates
Market participants were expecting the Capesize market to reach new record high level in near term due to healthy shipping demand and tight tonnage list.
Afterall, the freight forward agreement hit the second highest level of the year and may continue the upward momentum for further gains in coming weeks.
Both basins shown robust shipping demand, with the Atlantic market showing much improvement due to the thinner tonnage list.
Brazil’s Vale remained active in the market even after the recent fixing spree and were heard to be seeking for some post-Panamax instead of Capesize vessels.
So far, the ballaster list was tight for October loading and with firm supports of the bids and offers for October and early-November laycans.
VLSFO prices slip from recent rebound
VLSFO prices plunged by $9/mt day-on-day to $330/mt at the port of Singapore, after a recent price rebound amid market uncertainty.
The price decline followed the oil demand uncertainty with market concerns over the second wave of coronavirus outbreak in Europe. Moreover, the higher output from OPEC + in September also dampened oil demand and resulted in another price slump for crude oil.
Thus, Brent crude oil prices stabilized around the $40 per barrel level, while WTI crude prices were rangebound at the $38 per barrel level.