The Capesize paper market slipped in low volume as the Pacific market softened and sent mixed messages to trade participants.
Capesize 5 Time charter average dropped by $64 to $5,949 on Friday, after a selloff in the earlier session before flattening toward the end of the trading day.
Most market participants stayed on the sidelines to wait for clearer market directions amid oil prices volatility and the global economic impact of the coronavirus.
The previously-firm Pacific market had also extended into losses as trade participants worried over the one-month lockdown of Singapore starting from 7 Apr.
Thus, there were freight rates corrections on the West Australia to China route, despite some major miners like Rio Tinto and FMG seeking ships to move iron ore cargoes.
Standoff in Atlantic market
On the contrary, there are more uptick potential in the Atlantic market due to better weather in Brazil which may translate to more iron ore production and exports over the near term.
However, there were concerns over the closure of 25 of Vale’s mining dams ordered by Brazilian authorities over safety concerns.
According to trade sources, the dam closures were likely to have minimal impact on freight rates and iron ore output as many of these dams were located in inactive mining complexes.
Bunker prices firm on oil rally
VLSFO prices rose higher by $5.50 to $260/mt at the port of Singapore, due to the recent 50% jump in crude prices above the $30 per barrel level.
Brent crude oil price had hovered above the $30 per barrel mark and reached around the $33 per barrel level, while WTI crude also rose toward the $27 per barrel mark.
Besides the higher crude prices, the bunker prices also got more support after Singapore announced that its port will remain open, despite a nationwide lockdown till early May to contain the coronavirus pandemic.