Capesize freight rates soared to greater heights on better shipping demand amid tight tonnage supply.
The Capesize 5 time charter average, then jumped by $5,983 day-on-day to $69,013 on Tuesday, due to bullish market sentiments on higher C3 and C5 fixings.
The Baltic Dry Index (BDI) then rose by $245, up 5.19% day-on-day, to $4,962, continuing to chase for record-high level.
Better iron ore and coal shipping demand
Both basins were boosted by stronger shipping demand to move iron ore and coals on the back of tonnage supply tightness.
Port congestion remained a concern among the Chinese ports due to strict quarantine checks, while the recent power rationing policy caused more delays, especially among the northern China-based ports.
There was also more coal demand coming from Europe as they prepared for the upcoming winter heating season, and this resulted in rising backhaul orders and tightened tonnage supply in the Pacific.
The Pacific market also saw some fresh enquiries from Malaysia and Eastern Australia for coal shipments, while Atlantic freight rates were supported by healthy demand on the Trans-Atlantic and fronthaul routes.
Bunker prices rise despite market profit-takings
The bunker prices rose further despite softer crude market, as the price of VLSFO rose by $5/mt to $576.50/mt in the port of Singapore.
Brent crude prices dipped under the $80 per barrel level, due to profit-taking as market fundamental found support from tightening supplies.
In the meantime, the shortage of natural gas might lift oil demand for power generation, which was estimated to pick up by an additional 0.5 million barrels per day, as power plants switch to use fuel oil to generate electricity instead.