Capesize freight rates continued its downward trajectory, with both basins came under selling pressures as tonnages began to return.
The Capesize 5 time charter average, then fell further by $2,102 day-on-day to $46,987 on Wednesday, after much selling pressures.
The Baltic Dry Index (BDI) followed the decline and dropped by $119, down 2.88% day-on-day, to $4,013, due to weakening freight rates.
Slower demand as tonnage supply return
The freight market continued its correction phrase after the recent rally, as the tight tonnage supplies started to ease in the Pacific market.
Thus, there was more ballasting interests from shipowners to sail west of Singapore that upset the market fundamentals as shipping demand started to slow down.
However, there was market concerns over the port congestions in China, and some ports of the Southeast Asia regions like Vietnam that caused delays and formed queues for cargo discharge.
Meanwhile, the Atlantic market saw little actions, while most trade participants focused on October laycan for key route like Brazil to China.
Bunker prices rise despite market uncertainty
The bunker prices inched up slightly on the mixed market outlook, as the price of VLSFO rose by $0.50/mt day-on-day to $540/mt in the port of Singapore.
The OPEC had kept to their words for a supply hike of 400,000 barrel per day (bpd) starting in October as planned, while US crude inventories continued to decline by a weekly drop of 7.2 million barrels, as recorded by American Petroleum Institute (API).
Despite the firm market fundamentals, there was growing concerns over the effects of Covid Delta variant and its effect on oil demand that cast doubts on market recovery.