Higher demand across all vessel segments saw the Baltic Exchange’s dry bulk sea freight index extend it’s gains to 2,767 on Friday, its highest since November 12th. Among smaller vessels, the Supramax index added 32 points, or 1.4%, to its highest in nearly three weeks at 2,316. Despite recent volatility in vessel rates, dry bulk spot rates are expected to stabilize in November-December before a “seasonally soft” first quarter of 2022, shipbroker Jefferies said in a weekly note.
The Baltic Dry Index (BDI) is a composite of the dry bulk timecharter averages and provides a continuous time series since 1985. The BDI is a composite of and factors in rates for Capesize, Panamax and Supramax Timecharter Averages. It is reported around the world as a proxy for dry bulk shipping stocks as well as a general shipping market bellwether.
- Baltic Capesize Index (40%)
- Baltic Panamax Index (30%)
- Baltic Supramax Index (30%)
There a number of negative catalysts stemming from the climate and supply crisis stifling demand. While we are seeing easing congestion at Chinese ports and thin coal cargo flows out of the Pacific are weighing on capesizes. The new coronavirus variant Omicron will present another headwind in the immediate future for shipping and supplies.
With China striving to ease it’s energy crisis by limiting steel production to limit industrial power usage portside inventory of iron ore has swollen to the highest level in 31 months. China is the world’s top steel producer and their restrictions have crushed demand. for iron ore.
Baltic Exchange Dry Index (BDI) Segments (Nov 26 2021)
- The Baltic Exchange Dry Index rose 3.3% to 2,767 on Friday, its highest since November 12th, extending gains for a second straight session, amid higher demand across all vessel segments. For the week, the Baltic Dry Index rose 8.4%, its biggest weekly rise since the one ended October 1st.
- The capesize index, which tracks iron ore and coal cargos of 150,000-tonnes, jumped 3.4% to 3,906;, amid rising iron ore prices;.
- Average daily earnings for capesizes, which transport 150,000-tonne cargoes such as iron ore and coal, rose $2,272 to $32,210..
- The panamax index which tracks cargoes of about 60,000 to 70,000 tonnes of coal and grains, increased 5.3% to 2,621.
- Average daily earnings for panamaxes, which ferry 60,000-70,000 tonne coal or grain cargoes, increased by $85 to $20,620..
- The supramax index, for smaller vessel segments added 32 points, or 1.4%, to its highest in nearly three weeks at 2,316
What are the Baltic indices?
From The Baltic Exchange
The Baltic indices are based on assessments of the cost of transporting various bulk cargoes, both wet (eg crude oil and oil products),dry (eg coal and iron ore), gas (LNG and LPG) made by leading shipbroking houses located around the world on a per tonne and daily hire basis. The information is collated and published by the Baltic Exchange. We also provide daily container market assessments in collaboration with Freightos and a weekly air freight index as well as assessments on vessel operating costs, Sale & Purchase and vessel recycling prices.
The principal dry cargo indices are: the Baltic Exchange Capesize Index (BCI); Baltic Exchange Panamax Index (BPI); the Baltic Exchange Supramax Index (BSI); and the Baltic Exchange Handysize index (BHSI). The Baltic Exchange Dry Index (BDI) is calculated by taking the timecharter components of the Baltic’s capesize, panamax and supramax indices.
The Baltic Exchange International Tanker Routes (BITR) reports on international oil routes and makes up the Baltic Exchange Dirty Tanker Index (BDTI) and the Baltic Exchange Clean Tanker Index (BCTI).
We cover the gas markets through our LNG (BLNG) and LPG (BLPG) assessments.
Shipping investors are able to assess the health of vessel earnings through our quarterly operating expenses assessments, as well as our weekly Sale & Purchase and Recycling assessments.
Forward curves for all listed freight contracts are also published on a daily basis.
Source: The Baltic Exchange
From The TradersCommunity US Research Desk