UNITED KINGDOM January 19 2017 1:01 PM
LONDON (Scrap Register): The main sea freight index at Baltic Exchange for ships carrying dry bulk commodities climbed above 950 points on Wednesday boosted by stronger cape index.
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, shot up by 30 points to 952 points on Wednesday.
The BDI has had a slow start of the year, tracking the normal, seasonal slowdown that generally occurs in January through the Chinese New Year. Then, a snap-back rally can occur as China restocks following the market hiatus.
Cautious optimism remains when it comes to the near-term outlook for the BDI. The major downside concerns relate to the potential for shipping companies to bring more boats back into service that have been idled, as shipping rates improve. This could completely derail the BDI’s fragile recovery.