UNITED KINGDOM May 27 2016 3:23 PM
LONDON (Scrap Register): The main sea freight index at Baltic Exchange for ships carrying dry bulk commodities continued to decline to 601 points level on Thursday dragged down by lower demand for larger vessel segments.
The decline in demand for capesize ships could be due to seasonality. Demand for many commodities, including iron ore, increases in spring and then declines in summer. This is due to the typical, season restocking by many steel mills in China.
While demand for iron ore could decline over the coming months, the other BDI ships could see an increase in demand. Some of the smaller ships transport grains and other soft commodities and with harvest season underway, things are looking up.
The Baltic Dry Index, which provides an assessment of the price of moving the major raw materials – such as coal, iron ore and grain – by sea by taking in 23 shipping routes measured on a time charter basis, down by another 4 points to 601 points on Tuesday.
The index is based on a daily survey of agents all over the world. Baltic Dry hit a temporary peak on May 20, 2008, when the index hit 11,793. The lowest level ever reached was on February 10 2016, when the index plummeted to 290 points.