Capesize freight rates rebounded from previous losses and holidays lull, as the improving Pacific basin offered market supports.
The Capesize 5 time charter average, however still fell by $582 day-on-day to $25,032 on Tuesday, despite the rebound as more trade participants returned from holiday period.
The Baltic Dry Index (BDI) then fell by 1.08% or 28 points on-day to 2,568 readings, due to weakening freight rates.
Healthy Pacific basin to lift market sentiments
The improving Pacific market offered some hopes to the trade participants with good cargoes demand in iron ore and coal, plus plenty of fixtures done at better rates.
Due to the good shipping demand, shipowners preferred to keep their vessels in the Pacific, rather than ballasting west toward Brazil for the time being.
On the contrary, there was still muted market activities in the Atlantic basin, even though the workers strike of Colombia had ceased as market participants expected port operation still needed some time before resuming to normal.
In the meantime, some trade participants felt that Brazilian iron ore exports had improved but at a slower rate and expected Vale to increase shipments in near term.
Bunker prices receive support from pre-Covid crude prices
The higher bunker prices also provided some support to the freight rates, as the price of VLSFO jumped by $20/mt to $520/mt in the port of Singapore.
The price uptick followed the rise of Brent crude prices which crossed the $70 per barrel mark first time in two years, due to market optimism on global oil demand recovery.
Meanwhile, the US-Iran deal is likely to face some delay, which provide some support to the oversupplied market by placing the additional Iranian oil barrels in doubts.