UNITED KINGDOM February 09 2017 1:29 PM

LONDON (Scrap Register): The main sea freight index at Baltic Exchange for ships carrying dry bulk commodities fell further to 702 points on Wednesday as a drop in 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, down by another 12 points to 702 points on Wednesday.

While the week-long holiday in China is officially over, many factories remain closed and business activity is still ramping up. There is usually a post-Lunar New Year holiday restocking period which can boost the value of the BDI.

When it comes to demand for raw materials such as iron ore demand from China is expected to remain strong through the first half of the year. Heading into the holiday stocks of iron ore supplies sitting at ports swelled. 

With reduced demand over the holiday period and in the weeks leading up to and following the holiday it could be some time before new cargoes of raw materials are necessary.