Capesize freight rates continued to soften on bearish market sentiment, with lesser shipping demand to move iron ore and coals.
The Capesize 5 time charter average, then fell by $1,220 day-on-day to $34,845 on Monday, extending recent market corrections.
The Baltic Dry Index (BDI) followed the downtrend and dropped by $91, down 2.59% day-on-day, to $3,428, due to weakening freight rates.
Slower demand amid growing tonnage supply
Market demand for iron ore and coal became more sluggish, due to off peak winter season that resulted more sintering curbs on Chinese steel mills.
However, the ex-China market saw more shipping enquiries from Japanese and South Korean end-users that brought some balance to the supply and demand in the Pacific market, though port congestion remained a problem for shipment delays.
Meanwhile, the Atlantic market had experienced long list of ballasters that lowered freight rates, without hearing much fresh fixtures.
Bunker prices inch up on improving market outlook
The bunker prices rose on stronger crude prices, as the price of VLSFO inched up by $2/mt to $619/mt in the port of Singapore.
Despite the upticks, some trade participants expected some price correction in crude market with more supplies, as China decided to release some of its state reserves of diesel and gasoline to ease the shortfall.
Some market participants also expected the OPEC to increase output gradually, in relation to the power crunch, while there was a pickup of jet fuel consumption among the US and Europe due to the new vaccine-based travel regulations.