One measure of the economy is how much it costs to ship something from Point A to Point B - this is known as the Baltic Dry Index.
I had written about this back in November, 2015 - the index was then at an all-time low of 650. Things have not gotten better.
From gCaptain:
Hope Fades for Dry Bulk Recovery as Baltic Index Crashes Below 400 Points
The Baltic Exchange’s main sea freight index, tracking rates for ships carrying industrial commodities, slumped to an all-time low on Wednesday as gloom over global demand and too many ships for hire continued to batter prospects.
The overall index, which gauges the cost of shipping dry bulk cargoes including iron ore, cement, grain, coal and fertiliser, was down 8 points, or 1.99 percent, at 394 points – below 400 points for the first time – and the lowest level in records that date back to January 1985.
“Dry bulk shipping is in the throws of a generational recession,” said Ben Nolan of brokerage and investment bank Stifel. “The recovery in demand no longer appears to be a 2016 event and even 2017 is in question.”
Here is the chart from Bloomberg:
Leave a comment