Baltic Dry Index shows annual high in June
Published by Katherine Guenioui,
Editor
World Cement,
According to the Baltic Dry Index (BDI), June has reversed the 2015 dry bulk market trend in less than three weeks, since May, thus turning the market from low to slightly higher, so far.
The BDI average between February and May was 576, much lower than 829, which was the BDI recorded for June on 24 June 2015.
Chinese iron ore fixtures hit a high for 2015 in mid-May, according to data from Commodore Research. It would appear that the significant rise in BDI is due to the stronger capesize earnings, which have more than doubled in June. Naturally, the majority of it came from China’s main supplier, Australia, but the demand was supported by a high level of shipments out of Brazil too. Since then, capesize earnings lost some ground only to come back as more shipments were coming out of Brazil and Australia again.
Chief Shipping Analyst at BIMCO, Peter Sand, states: “We have seen the BDI constantly go higher since end-May. Chinese iron ore fixtures has been on a slow but rising trend throughout the year, so what we are seeing now has been long coming.” He continued: “But this is not all about the demand. The lift would not have been possible without the support coming from a decreasing capesize fleet size. Since we entered into 2015, the capesize fleet is now short of 22 ships equal to a drop in capacity of 0.7%.”
Moreover, he stated: “As we have said before, BIMCO do expect rising volumes as the year progresses, which should support the market if the supply side also contributes with limited fleet growth. In spite of the most recent development the market is still moving forward on fairly thin ice.”
Adapted from press release by Katherine Guenioui
Read the article online at: https://www.worldcement.com/europe-cis/25062015/baltic-dry-index-shows-june-reaching-an-annual-high-69/
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