Capesize freight rates fell from a selloff in the paper market, despite more shipping activities as Chinese trade participants returned from holidays.
The Capesize 5 time charter average, then went down by $3,088 day-on-day to $83,865 on Friday, despite some late rebound at the market close.
The Baltic Dry Index (BDI) also dropped by $124, down 2.19% day-on-day, to $5,5260, due to softening freight rates.
Mixed market directions amid extreme weather in Southern China
There was much market uncertainty over typhoon weather conditions set to affect southern China regions, which might result in disruption of port operations.
Thus, it was hard to predict market directions in view of extreme weathers and the shipowners preferred to keep vessels in the Pacific, amid the thin cargo list and standoff between owners and charterers.
Likewise, the shipping activities were quietened in the Atlantic basin with lower offers for the key Brazil to Qingdao route. As market sentiments were softened over concerns of reduced steel output in China and lower demand for high grade iron ore fines.
Bunker prices jump to record high, following high crude prices
The bunker prices soared to record high, as the price of VLSFO jumped by $10.50/mt to $591.50/mt in the port of Singapore.
The record high bunker prices were related to the high crude prices that reached three-year high with Brent prices staying above $80 per barrels for an extended period.
As the crude rise was driven by energy crunch in Europe, which pushed natural gas prices to record high and led more end-users to seek for alternative in fuel oil for power generation and preparation for the upcoming winter heating season.