Capesize freight rates gained from recent improving shipping demand, despite slow trading activities due to Chinese holidays.
The Capesize 5 time charter average, then rose by $1,631 day-on-day to $29,383 on Monday, from a buoyant market which left much room for the physical market to catch up.
The Baltic Dry Index (BDI) followed the rally and hiked up by 3.05% or 87 points on-day to 2,944 readings.
Slow market momentum due to holidays
The FFA market continued to pick up pace from last week rally, though at a slower pace from Chinese holidays at the start of the week.
This caused limited fresh shipping inquiries in the Pacific market after the recent flurry of fixtures done in previous week.
Meanwhile, the Atlantic market continued to improve with more iron ore shipping demand from Brazil that reduced the ballaster list gradually, while most trade participants were hopefully for more demand upticks later in the month.
Bunker prices rally on firmer crude demand
The bunker prices rose higher on firm crude prices, as the price of VLSFO jumped up by $4/mt to $528/mt in the port of Singapore.
Brent crude oil prices went up to a two-year high toward the $73 per barrel level, due to market optimism over oil demand recovery from the efficacy of Covid vaccines globally.
Thus, global oil demand is expected to rise by 6 million barrels per day (bpd) for 2021, with strong demand coming from the US and China in the second half of 2021, according to OPEC monthly report.
Meanwhile, the US-Iran talks remained in the limbo, due to the Iranian presidential election taking place soon, while market was skeptical if both sides could reach a deal soon.