Capesize freight rates continued to rise on better market sentiment for the physical market, after a sluggish start of the week.
The Capesize 5 time charter average, then rose up by $951 day-on-day to $34,299 on Tuesday, due to better physical market.
The Baltic Dry Index (BDI) also hiked up by 2.83% day-on-day, up 94 points to 3,418 readings, due to better freight rates.
Picking up of pace by the physical market
The shipping demand improved in both basins as the market moved to the usual peak Q3 season.
Hence, the Pacific market enjoyed healthy cargo list with robust iron ore and coal shipping demand, supported by constant stream of enquiries from the Japanese and South Korean end-users.
On the contrary, the Atlantic market seemed to be constrained by limited market activities and the lengthy ballaster list especially for early and mid-July windows.
However, the trade participants remained optimistic that the demand will eventually offset some of the high tonnage supply as Brazilian miners ramped up production and exports during the second half of the year.
Bunker prices dip after Delta Covid variant scare
The bunker prices dipped on softer crude prices, as the price of VLSFO dropped by $7.50/mt on-day to $541/mt in the port of Singapore.
The recent decline followed market concerns over the effect of Delta Covid variant on the recovering global oil market as it spread over 85 countries.
The market scare caused Brent crude oil prices to dip below the $75 per barrel mark in end-June, despite OPEC’s effort to calm the market that oil outlook remained bullish for H2 2021.