UNITED KINGDOM September 15 2016 7:47 PM
LONDON (Scrap Register): The main sea freight index at Baltic Exchange for ships carrying dry bulk commodities plunged 40 points a day on Wednesday as holidays in Asia decrease shipping demand.
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 further by another 40 points to 756 points on Wednesday.
After embarking on a quick paced rally, the Baltic Dry Index has plunged this week. On Wednesday, the shipping index declined 40 points to touch 756 points as the BDI’s jump to an 11-month high lost steam.
While optimism remains over the near-term expectations for the BDI, and upside could accelerate again as we head into fall, this week, holidays in Asia meant shipping activity was muted on some of the major routes.
Out of the BDI component ships, capesize prices saw the largest declines even though all ship hire rates were weaker. The larger fall in capesize hire rates is not surprising given that they experienced the loftiest gains last week.
Also, the raw materials that capesize component ships transported are the ones that have been the most in demand in Asia.
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