Shipping rates for dry cargo goods such as iron ore, coal and grains have fallen back from a short-lived rally on fears that China will ease its buying of iron ore. The decline spells more uncertainty for Middle East shipping firms, which set prices based on global trends.?? The Baltic Dry Index, a measure of worldwide shipping routes determined by the London-based Baltic Exchange, fell to the lowest point in more than two months last week, to 1,466, on fears China would curb purchases of iron ore. This reflects a 36 per cent drop from a rally that began in February and lasted until mid-March, when it hit a high for this year of 2,298.
The fluctuating charter rates at the Baltic Dry Index, seen as an barometer for global trade and a harbinger for future growth, suggests that there are still few clues when the global downturn will hit bottom and begin turning up again. “The industry in general is in a state of flux at the moment. We don’t have any strong indicators where the economy is heading,” said Raffi Vartanian, an analyst at Freight Investor Solution (FIS).
Last year saw the Baltic Dry Index reach extreme highs and lows as a global economic bubble finally burst following the failure of several large US banks. The index reached an all-time high of 11,793 on May 20, but by December, it sunk to a 22-year low of 663 as steel production was slashed.
The fluctuating charter rates at the Baltic Dry Index, seen as an barometer for global trade and a harbinger for future growth, suggests that there are still few clues when the global downturn will hit bottom and begin turning up again. “The industry in general is in a state of flux at the moment. We don’t have any strong indicators where the economy is heading,” said Raffi Vartanian, an analyst at Freight Investor Solution (FIS).
Last year saw the Baltic Dry Index reach extreme highs and lows as a global economic bubble finally burst following the failure of several large US banks. The index reached an all-time high of 11,793 on May 20, but by December, it sunk to a 22-year low of 663 as steel production was slashed.
