Capesize freight rates continued to slump on the growing tonnage list, despite strong bunker prices that failed to support prices.
The Capesize 5 time charter average then dropped by $1,463 day-on-day to $14,053 on Tuesday, after a selloff in the market.
The Baltic Dry Index (BDI) also plunged by 4.43% day-on-day or 64 points to 1,380 readings on softening freight rates.
Growing vessels supply amid moderate shipping demand
Freight rates continued to drop at the rising vessel supply as the ballasters list grew in the Atlantic basin, while shipping demand failed to keep up the pace.
Some shipping demand did emerge out of the North Atlantic and Brazilian market with major miner like Vale heard to fix several vessels for the key Brazil to China route for March loading window.
However, there was muted market activities for the February loading window, due to the standoff between owners and charterers.
Meanwhile, the Pacific basin fared better with more shipping demand in the key western Australia to China route, though freight rates continued to fall from lower bookings.
As such, major miner like Rio Tinto was heard to secure several vessels for late February laycan in the key west coast Australia to China route, done around high $5s/mt range.
Bunker prices rally on higher crude prices
The bunker prices continued to rally on better crude oil prices, as the price of VLSFO rose by $15.50/mt to $469.50/mt at the port of Singapore.
Brent crude prices headed toward the $58 per barrels level, after the recent crude inventory drawdown in the US.
Despite the bullish run, OPEC+ had lowered their oil demand estimates for 2021 to 5.6 million barrels per day (bpd) as compared to previous forecast of 5.9 million barrels per day, due to negative economic impact from the global resurgence of Covid cases.