The deterioration of Capesize market had led to the surprise of many trade participants as there was still some healthy volume from west Australia.
Despite the healthy physical volume, the Capesize 5 time charter average dropped by $1,016 on-day to $3,842 on Monday, after a fresh round of sell off.
According to trade sources, at least five vessels were fixed by major miner and operator for the west Australia to Qingdao route at the range of $3.70-$3.80/wmt.
Many shipowners were heard to ballast their vessels for the Pacific market for the June dates that resulted a lengthy tonnage list and there were doubts if these supplies will be absorbed by market demand.
Subdued Atlantic market
Likewise, the tonnage list remained lengthy in the Atlantic market with little fresh activity being reported.
Due to the high tonnage list of ballasters, some shipowners decided to ballast toward to South African market instead.
Some trade sources expect the market to recovery in the second half of June, after a depressing first half June period.
VLSFO hikes on rebound of oil demand
VLSFO bunker prices rebounded by $6.50 to $257/mt at the port of Singapore, following higher crude price movement.
Brent crude prices recovered from the dip toward $29 per barrel and rose toward the mark of $30 per barrel, while WTI crude prices headed toward the $25 per barrel.
Goldman Sachs expects oil demand may rebound enough to exceed supply by the end of May, as countries tried to resume their economies from lockdowns.
The first drawdown is expected from the floating storage and it was estimated to drag till Q3 2020 with the removal of 450 million barrels, then the onshore storage may start to decline at around 400 million barrels at Q4 2020. bunkerCapesizeGoldman SachsVLSFOWTI