Capesize freight rates continued to rise due to market optimism over Covid-19 vaccines that improve shipping and oil demand.
The Capesize 5 time charter average hiked up by RMB 427 day-on-day to $14,848 on Monday, as market sentiment improved.
The Baltic Dry Index (BDI) also moved up by 0.92% or 11 points to 1,207 readings, due to improvement in Capesize freight rates.
More improvement in the Pacific
There was some improvement among the cargo list of the Pacific, with new fresh shipping inquiries and several fixtures done at higher rates.
It was heard that mining major, FMG had secured few vessels for the key west Australia to China route for late November laycan around $7/wmt, while other shipping operators were heard to fix several vessels for the same route.
There were also some market concerns over the unfavorable weather in North China that might delay shipments and disrupted shipping activities in short term.
In the Atlantic market, the long ballast list continued to depress freight rates, however some trade participants were heard to be looking at the end-November laycan window.
VLSFO bounces on crude oil rally
VLSFO prices rebounded by $1/mt to $340/mt in the port of Singapore and lent support to the firmer freight rates.
The bunker uptick was in line with the global market optimism of the Covid vaccine breakthrough that caused crude oil prices to rally by around 8%.
Thus, the crude oil prices buoyed toward $42 per barrel level, while WTI crude oil prices hovered at the $40 per barrel level on better market sentiments.
Despite the optimism, Citibank revised its forecast for Brent Crude oil prices to average $54 per barrel for 2021, down from previous estimate of $60 per barrel, due to renewed lockdown measures among European countries from second wave of pandemics.