Capesize freight rates continued to rise on improving shipping demand, especially in the Atlantic market.
The Capesize 5 time charter average then went up by $846 day-on-day to $13,128 on Tuesday, despite softening freight rates in the Pacific.
The Baltic Dry Index (BDI) also maintained its upward climb and went up by 3.08% or 38 points to 1,273 readings, due to improving freight rates.
Higher freight rates for key Brazil to China route
The Atlantic market continued to draw much market attention due to thinner ballaster list, while shipping demand seen much improvement lately.
Some trade participants credited the market optimism to the last week of fixture before the holidays season, as some miners tried to catch up on their exports.
As such, the indicative freight levels heard on the Brazil-to-China route rose around $1.50/wmt on-day to the range of $14.50-$15.00/wmt by mid-December.
However, there was some market concerns over adverse weathers, such as rainy season in Brazil, while the Australia’s Bureau of Meteorology warned of more tropical cyclones during summer season of Dec-Feb period, due to strong La Nina effect.
In contrast, the Pacific market saw less shipping activities, with only Rio Tinto heard to be seeking for vessels, while there were some Australian coal shipments being fixed for the Indian market.
Some correction for bunker prices after rally
The bunker prices saw a slight correction after recent rally, as the VLSFO dipped by $2.50/mt to $394.50/mt at the port of Singapore.
The decline was in contrary to market optimism over recovering oil demand with the distribution of Covid-19 vaccines, which may accelerate global economic normalcy by summer 2021.
However, the oil market remained volatile at best, with new round of lockdowns in Western Europe affecting oil demand, while the OPEC + is scheduled to meet later this week on whether to add another 500,000-bpd production in February next year.