Capesize freight rates made small gains after cooling down from the recent rally over better shipping fundamentals.
The Capesize 5 time charter average then gained slightly by $464 day-on-day to $28,520 on Friday, despite relative smaller volumes traded at the close of the week.
The Baltic Dry Index (BDI) also rose further by 2.67 % or 62 points to 2,385 readings, after a strong rally week led by larger vessels.
Rising paper market but little physical activity
After much rally in the forward freight agreement market, there was some cooling off in the market, as the physical trading activities waned with few fresh enquiries.
Both the Pacific and Atlantic basins saw limited trading activities with less fresh cargoes, while more trade participants moved to work on May loading windows.
Mining major, Rio Tinto and FMG were heard to fix some vessels for the key west coast Australia to Qingdao route at the range of $11.25-$11.50/wmt.
Meanwhile, the Atlantic basin was boosted by healthy cargoes list out of South Africa, which otherwise the market was muted as the indicative freight rate for the Brazil-China route were heard at the low-$25s/wmt to $26/wmt range.
High bunker prices to lift freight rates
Bunker prices continued to climb higher on better crude prices, as the price of VLSFO rose by $8.50/mt to $512.50/mt in the port of Singapore.
Crude oil prices went up further in pushing toward the $67 per barrel levels, amid market optimism of better oil demand with recent US inventory crude draw and better gasoline consumption during the summer season.
Thus, consultancy firm, Rystad Energy forecasted a 6% yearly increase in global oil demand for 2021 at an average of 95.4 million bpd, with the US and China contributing higher stakes to oil demand.