Capesize freight rates continued to weaken due to slow shipping activities and oversupplied market, amid holidays season.
The Capesize 5 time charter average, then plunged down by $6,289 day-on-day to $32,838 on Tuesday, after a massive selloff in the paper market.
The Baltic Dry Index (BDI) also dropped by $284, down 8.83% day-on-day, to $2,932, due to softening freight rates.
Sell off now and go for holidays
Freight rates slumped further as the holidays season approached, with many trade participants heard to treat this week as the last active trading period before going for holidays.
In the light of this view, there were many selloffs in the paper market for profit-takings, while cargo demand diminished amid growing tonnage lists.
Thus, the freight rates came under pressure from competitive pricings, while most of the miners and operators were in collecting mood, amid weak shipping demand.
Similarly, the Atlantic market saw limited market activities from the thin cargo demand, amid the traditional lull holidays season.
Bunker prices dip on expected market surplus
The bunker prices dropped amid volatile market, as the price of VLSFO went down by $1/mt to $601.50/mt in the port of Singapore.
The market volatility was due to market concerns over oil demand as tightening restrictions were adopted by some European countries and the US to contain the spread of Omicron variant.
In the wake of reducing crude demand, the oil market is facing surplus supplies, as production had increased among OPEC and oil producing countries like the US, Canada, and Brazil, according to the International Energy Agency.