Capesize freight rates rallied further with record gains, amid Chinese port closures due to the Typhoon Chanthu.
The Capesize 5 time charter average, then rose by $6,736 day-on-day to $52,908 on Monday, as significant gains were made in the Pacific and Atlantic markets.
The Baltic Dry Index (BDI) then rose by $299, up 7.74% day-on-day, to $4,163, due to better freight rates.
Supply driven rally amid typhoon concerns
Freight rates strengthened further from tight tonnage supply with market concerns on typhoon threat and suspension of port operations that led to more Chinese ports’ congestion and shipment delays.
Shipping demand also improved on the back of iron ore shipments for the Pacific market, as the typhoon Chanthu disrupted end-September laycans for western Australia to China route.
Likewise, the Atlantic market also spotted gains from the potential supply tightness from Typhoon Chanthu and attracted shipping demand for October laycan.
Bunker prices rise on firmer crude market
The bunker prices rebounded on volatile market outlook, as the price of VLSFO rose by $4/mt to $548/mt in the port of Singapore.
The supply tightness from the aftermath of Hurricane Ida continued to haunt market on reduced refining capacities in the Gulf of Mexico, while Covid Delta variant casted doubt on oil demand recovery.
Market sentiments were mixed as well, as OPEC forecasted global oil demand of 2021 to grow by 5.96 million barrels per day (bpd), up 6.6% yearly, while China’s releasing of its strategic reserve may have some price easing effect on the market.