Capesize freight rates rallied on better shipping fundamentals with improving demand seen in the Atlantic basin.
The Capesize 5 time charter average, then went up by $3,713 day-on-day to $27,752 on Friday, due to improving basins despite Chinese holidays period.
The Baltic Dry Index (BDI) also went up by 7.04% or 188 points on-day to 2,857 readings, following a better freight market.
Recovering demand in the Atlantic basin
The FFA upticks traced to recent improvement in the Atlantic market, where Brazilian miner, Vale was heard to secure some vessels done at better rates.
Thus, the ballaster list was reduced by the upticks of demand for moving iron ore cargoes for the key Brazil to China route.
Some trading houses were also heard to secure fixtures for the west Africa to China route for July laycan done above the $32/wmt level.
In the meantime, the Pacific market continued to attract higher iron ore and coal shipping demand that resulted in fixtures done at higher levels.
Bunker prices rise slightly despite declining demand
The bunker prices inched up slightly after recent slump, as the price of VLSFO dipped by $0.50/mt to $524/mt in the port of Singapore.
The slight gain reflected the declining bunker demand in Singapore, which dropped to 11-months low in May.
According to the country’s Maritime and Port Authority (MPA), the bunker volume recorded 4.1 million mt in May 2021, down 4.3% on-month and 3.7% on-year.
During the month of May, VLSFO sales also dropped to 1.3% on-month to 2.8 million mt, due to the resurgence of coronavirus cases in Asia. Moreover, shipping companies had stockpiled VLSFO supplies previously and were more cautious in new purchases.