Capesize rates dropped on limited market activity as some trade participants were away due to public holiday in Singapore.
The Capesize 5 time charter average dipped by $437 day-on-day to $27,644 on Friday, as the paper market was muted and rangebound due to the Singapore holiday.
Due to the quiet market, the Baltic Dry Index (BDI) remained flat at 1,810 reading on Friday, unchanged day-on-day.
Waiting for further corrections
Some trade participants felt that the freight rates had been to high recently and expect further corrections after almost a month-long rally.
Much of the rally was attributed to China’s robust steel demand that supported iron ore prices and dry bulk freight rates as the economy made a fast recovery from coronavirus pandemic.
Moreover, most trade participants expect Vale to increase shipments during the second half of the year to catchup for the shortfall earlier this year. Besides, the tight early tonnage list in the Atlantic market might drive further freight rate recovery over the near term.
Bunker demand slips for the second month in Singapore
VLSFO prices fell by $6/mt to $330.50/mt at the port of Singapore, as the city-state recorded a decline in bunker demand for the second consecutive months in June 2020.
According to Maritime and Port Authority (MPA), the preliminary data showed a monthly dip of 2.5% in total bunker demand at 3.829 million mt in June.
The dip corresponded to the lower vessel calls to the port of Singapore during the month of June at 3,178 vessels, down 3.2% year-on-year due to lower economic activities brought by COVID-19.