Capesize freight rates were subdued toward the end of the week, following the selloff in paper markets and thin physical market.
The Capesize 5 time charter average dropped by $1,785 day-on-day to $19,952 on Friday, as the physical market showed no signs of improvement.
Due to weak freight market, the Baltic Dry Index (BDI) plunged by 5.38% or 84 points to 1,477 readings.
Freight rates yet to find a floor
Most of the market participants held bearish short-term outlook due to plunging Brazilian freight market amid high ballaster list for November dates.
Due to weak freight market, market participants preferred wait and see attitude and felt that the falling rates were yet to find a floor.
As such, there was absence of mining companies in the Pacific market and the indicative freight for the West Coast Australia to Qingdao route was heard in a range of $7.40-$7.80/wmt.
Meanwhile, the Capesize rates continued to soften in the Atlantic market with some fixings done off Brazil, while the transAtlantic market was also weakening amid moderate demand.
VLSFO prices plunge on lower oil demand
VLSFO prices slid by $4.50/mt day-on-day to $344.50/mt at the port of Singapore, following the slump in recent crude oil prices.
Brent crude oil plunged toward $42 per barrel, while WTI crude inched down toward $40 per barrel, due to market concerns over the rising second wave of coronavirus outbreak that affected oil demand.
According to IHS Markit, the softening oil demand in China may cause oil import to drop around 1.7 million barrels per day (bpd) or 14.5% quarter-on-quarter in Q4.