Capesize freight rates continued to lose ground on thin trading activities amid sluggish shipping demand.
The Capesize 5 time charter average, then plunged down by $1,333 day-on-day to $27,773 on Monday, after selloff session.
The Baltic Dry Index (BDI) also dropped by 1.86% day-on-day, down 61 points to 3,224 readings, due to the weakening freight rates.
Sluggish start for the month
Market outlook was bearish after selling pressure in the paper market, while the physical market lacked fresh enquiries to support firmer rates.
Despite the healthy cargo list in the Pacific, the freight rates found little support in the declining rates with deals done at lower rates.
However, there was still some market optimism in the Pacific market with steady flow of enquiries from South Korean trade participants, though not high enough to change market sentiment.
The Atlantic basin experienced a quiet trading day, with much market chatters but failed to conclude to any firm fixtures. It was heard that some Capesize owners were trying on Panamax stem, due to the decent freight differentials between the Capesize and the Panamax markets.
Bunker prices jump on oil spike
The bunker prices rose further on firmer crude market, as the price of VLSFO went up by $2/mt on-day to $555.50/mt in the port of Singapore.
Brent crude prices surged above the $77 per barrel mark, a three-year high, after OPEC failed to come up with any agreement to ramp up production in recent meeting.
Market participants interpreted the disagreement as tighter supply for the crude oil market after the proposal to increase output of 2 million barrels was vetoed by other OPEC members like UAE.