Capesize freight rates dipped after recent rally with corrections in the paper market, amid the sluggish physical market.
The Capesize 5 time charter average then inched up by $518 day-on-day to $33,808 on Thursday, as trade participants took a breather from the FFA market.
The Baltic Dry Index (BDI) then rose by 1.48 % or 40 points to 2,750 readings, due to better freight rates.
Halftime for trade participants
After louder market voices for ‘super cycle’, there was some corrections that broke the upward momentum due to standoff between owners and charterers.
Thus, the Pacific market saw softening rates, though major miners like Rio Tinto and FMG were still active in seeking vessels to move iron ore cargoes in the key west Australia to China route.
Meanwhile, the Atlantic market seemed to be on firmer footing due to tight tonnage supply and market expectation of more iron ore shipments from the Brazilian miners in near term.
Besides, there was also healthy iron ore and coal shipping demand for South Africa, though the market enquiries had cooled down after recent flurry of fixtures.
Bunker prices fall over demand concerns
Bunker prices continued to fall over oil demand doubts, as the price of VLSFO dropped by $4/mt to $496.50/mt in the port of Singapore.
Market participants were concerned over rising Covid cases in India that affected oil demand recovery. However, there was market bright spots as well, as France started to relax social distancing measures in coming weeks.
Meanwhile, there was uptick in crude oil prices due to Libya’s oil production decline by 1 million bpd due to budgetary issues.