Capesize freight rates softened on limited shipping activities, as holidays season approached that slowed trading in the market.
The Capesize 5 time charter average, then slumped down by $3,134 day-on-day to $24,003 on Thursday, after sustaining further losses in the paper market.
The Baltic Dry Index (BDI) also dropped by $167, down 6.27% day-on-day, to $2,498, due to softening freight rates.
Slowing demand amid holiday season
Freight rates followed the downward momentum with the thin cargo list and oversupplied market.
In the Pacific market, there was lack of coal cargoes, probably due to improving domestic coal supply in China and the previous restocking activities that took place.
Though, some trade participants expected better iron ore shipping demand, as Chinese mills were heard to be low in steel inventory and might replenish more iron ore stocks for steelmaking.
In the meantime, the Atlantic market remained bearish with freight rates creeping down on lack of shipping demand as market activities slowed in the holidays season.
Bunker prices jump on better market outlook
The bunker prices jumped amid market volatility, as the price of VLSFO went up by $7.50/mt to $602.50/mt in the port of Singapore.
The uptick pointed to the draw in US crude inventories and upbeat economic outlook that lifted overall market sentiment in oil demand.
As EIA reported a drop in US crude stocks at 4.6 million barrels, beating market estimate which indicated better fuel consumption in mid-December.