Capesize freight rates plunged as the physical market came under pressure and resulted a selloff in the paper market.
The Capesize 5 time charter average then fell by $2,320 day-on-day to $25,614 on Friday, following the selloff.
The Baltic Dry Index (BDI) also dropped down by 3.42% or 92 points on-day to 2,596 readings, due to softening freight rates.
Bearish market sentiments for both basins
The paper market reflected the scant activities in the physical market, which resulted some trade participants to ponder if the freight rates had yet to find the floor.
Even the heathy cargoes demand in the Pacific market seemed to have slowed down by little, causing fixtures to be done at lower rates.
Meanwhile, the high tonnage supply continued to plague the Atlantic market, putting pressure on the freight rates, despite market hope for more Brazilian iron ore shipping demand in near term.
Firm bunker prices fail to support freight rates
The rising bunker prices failed to support the weakening freight rates, as the price of VLSFO increased by $4/mt to $496/mt in the port of Singapore.
The firmer crude oil market was supported by strong US economic data and signs of global oil consumptions recovery, that negated the potential additional oil supply from Iran.
Thus, Brent crude prices were heading toward $70 per barrel level, though OPEC + is expected to ramp up oil supply gradually by approving the 840,000 barrels per day increase starting in July.