Capesize freight rates extended losses in seasonally lean period, amid weak iron ore and steel demand in China.
The Capesize 5 time charter average, then slumped by $2,653 day-on-day to $25,406 on Wednesday, amid a selloff session.
The Baltic Dry Index (BDI) then dropped by $161, down by 6.21% day-on-day, to $2,430, due to softening freight rates.
Bearish market sentiment amid lull season
Freight rates declined further at the start of the lean season when rates were lower, while shipowners tried to fix before rates plunged down further.
Thus, many trade participants expected more freight corrections ahead, though there might be some small rebounds as some market participants rushed to fix before the holidays season.
Fresh enquiries were heard in the Pacific market, coming from the South Korean and Japanese trade participants as they were attracted by the low commodities and freight prices.
However, freight rates continued to depress in the Atlantic market, due to the growing ballaster list and yet found little supports from limited shipping demand.
Bunker prices extend downward slide on market volatility
The bunker prices slipped on the volatile crude market, as the price of VLSFO dropped by $3/mt to $619.50/mt in the port of Singapore.
Crude markets were in jitters after the recent US and China talks called to curb inflations by pressuring down oil prices. However, nothing had been in concrete yet, except verbally confirmation that plunged the market into uncertainty.
Meanwhile, there had been some market talks that the global energy crunch will be temporary and last till Q4 2021, before swinging to surplus supplies by early next year.