Capesize freight rates continued to slide despite a flurry of fixtures done by Brazilian miner over a short span of days.
The Capesize 5 time charter average went down by $898 day-on-day to $18,570 on Thursday, despite bullish sentiment over the Brazil to China route.
The Baltic Dry Index (BDI) then dropped by 3.19 % day-on-day to 1,518 readings on softer Capesize freight rates.
Busy fixing week for Vale
There was panic selling in the paper market due to market expectation of shipowners to draw down offers further with falling freight rates yet to find a floor.
Despite the bearish market sentiment, Brazilian miner, Vale had fixed over ten ships over the short span of two days mostly for September laycan at the key Brazil to China route.
After these fixtures, the miner did not rest on its laurels and was heard to be in talks for seeking more ships for the September laycan again with rates at around mid-$17/wmt level.
Meanwhile, there was less fixtures in the Pacific market amid healthy shipping demand for coal and iron ore.
Miners like Rio Tinto and FMG were heard to fix a vessel each for September laycan for the west Australia to China route but were unable to spur the market for higher freight rates.
Bunker prices drop on supply glut
VLSFO prices dropped by $1/mt day-on-day to $349/mt at the port of Singapore, amid softening bunker demand.
Due to port congestion in China, there had been a long queue of oil tankers among the Chinese ports waiting for unload.
According to Wall Street Journal, it was estimated to have a pileup of 80 tankers with over half made up of Very Large Crude Carriers with capacity to ship 2 million barrels of crude oil.
Some market participants feared that the long queue of vessels will add on to the fuel glut in Asia amid improvement in oil demand as the global economy recovered gradually from the pandemic.