Capesize freight rates dipped slightly despite market optimism over flurry of fixtures being done in the Pacific market.
Thus, the Capesize 5 time charter average inched down by $25 day-on-day to $11,996 on Tuesday, as market pullback for a slight correction.
The Baltic Dry Index (BDI) however, moved flattish and booked a slight gain of 0.77% or 9 points to 1,178 readings, amid softening freight rates.
Pacific rally to keep market afloat
The Pacific market continued to exhibit strength with better shipping demand with miners seeking actively to move iron ores from west Australia to China.
Both Rio Tinto and FMG were heard to secure vessels at the range of $7/wmt and $7.10/wmt, for the west Australia to China route on early December laycan.
It was also heard that the returns for a Pacific round voyage were at a premium over other routes such as trips out of the Atlantic.
Meanwhile, the Atlantic market was still oversupplied with long ballast lists, though there was some expectation of increased shipping activities brought by Brazilian miners might digest some of this surplus toward year-end.
Bunker prices soar further on market optimism
The higher bunker prices seemed to do little to support the freight rates, as the VLSFO continued to rise by $2.50/mt to $377/mt at the port of Singapore.
The crude oil market continued its bullish run on market optimism for the coronavirus vaccines that drove hopes for global demand recovery in 2021.
Thus, the Brent Crude prices went up higher toward $48 per barrel, while the WTI Crude prices headed toward $45 per barrel, almost an eight-month high, due to bullish sentiment.