Capesize freight rates slid downward due to market uncertainty and discounted paper curve, with concerns over falling iron prices.
The Capesize 5 time charter average, then dropped by $1,100 day-on-day to $52,281 on Thursday, as market participants were more cautious over mixed outlook.
The Baltic Dry Index (BDI) then dipped by $18, down 0.43% day-on-day, to $4,215, due to softening freight rates.
Further freight corrections after record-high rally
Freight rates extended losses with market concerns over declining iron ore prices, weak China’s macroeconomic data in August and receding effects of typhoons.
Thus, there was some easing to the tight tonnage list that weight freight rates down, though the Pacific market continued to enjoy healthy shipping demand for both iron ore and coal cargoes.
As such, there were strong iron ore shipping demand for early October loading window for the key West Australia to China route.
Meanwhile, the Atlantic market were affected by market uncertainty as Brazil freight rates were in backwardation, despite strong coal and iron ore demand.
Bunker prices rise on better sales
The bunker prices strengthened on firm crude market and better sales, as the price of VLSFO rose by $6.50/mt to $558.50/mt in the port of Singapore.
The bunker sales of major ports had experienced gradual growth, as evident of Panama’s bunker demand rose by 0.4% on-month and 4.5% yearly to 388,640 mt in August.
In the meantime, crude oil prices had stabilized toward $75-76 per barrel, as the effects of Hurricane Nicolas were mild unlike the previous Hurricane Ida, allowing refining output to recover in the Gulf of Mexico and Texas.