LONDON (Scrap Register): The main sea freight index at Baltic Exchange for ships carrying dry bulk commodities shot up by 86 points on Thursday driven by sharp increase in cape, panamax and supramax rates.
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, gained another 86 points to 1,231 points on Thursday.
The BDI has climbed from an all-time low of 290 in February this year. Currently the index is around 1,231. The index has risen nearly 325 percent from February lows.
In recent years, dry bulk shipping demand had stagnated, going from consistent 3% to 4% annual growth to almost no growth at all in 2015.
The Baltic Dry Index started to rise before Trump won the White House, probably due to efforts by Beijing to stimulate the Chinese economy.
Freight rates for some large Capesize ships, the most sensitive rates typically, have now increased to 18-month highs and the Baltic Dry Index has surged to highs not seen in over a year.