Capesize freight rates continued its bullish run, due to better market outlook with improving physical demand.
The Capesize 5 time charter average, then rose by $2,618 day-on-day to $33,258 on Wednesday, after much premiums on the FFA market that might translated to the physical market.
The Baltic Dry Index (BDI) then followed the rally and reached 3,176 readings, up by 4.99% or 151 points on-day.
Upward freight movement on bullish outlook
Freight rates strengthened on higher fixtures reported in the physical market with more iron ore shipping demand in both basins.
Though trading activities were relatively slow in the Atlantic basin as compared to the Pacific market, but the market outlook remained strong which attracted some ballasting interests.
However, most of the trade participants were in collecting mood, while there was a standoff between owners and charterers in the Atlantic basin.
Meanwhile, the Pacific market remained a source of strength for iron ore shipping demand as some miners conducted more shipments as they tried to close their books for the financial year.
In the meantime, strong demand from Japanese and South Korean steel mills also lifted freight rates with fresh enquiries to move raw materials.
Bunker prices move upward on bullish outlook
The bunker prices rose on firmer crude market, as the price of VLSFO jumped up by $8/mt to $537/mt in the port of Singapore.
Brent crude oil prices moved up from strength to strength and approached the $75 per barrel mark by mid-June for the first time in two years.
The price uptick was driven by lower crude inventory recorded in the US, as the Energy Information Administration (EIA) recorded a draw of 7.4 million barrels for the week ended in Jun 11, while refining utilization jumped to a 1.5 year-high to 92.6%.