Baltic Dry Index Rises To Highest Peak In A Decade

On Monday, the Baltic Exchange’s main sea freight index advanced to a more than 11-year peak on rising demand for all vessel sizes, with capesize rates extending their winning run to an 11th straight session. The net or overall index, which takes in rates for capesize, panamax, supramax and handysize shipping vessels, boosted by 55 points, or about 1.3%, to its highest since mid-2010 at 4,147.

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The main index has risen for nine straight sessions, while the capesize index jumped by 117 points (2%) to a 12-year high at 6,114. The Average daily earnings for capesizes, which typically takes 150,000-tonne cargoes such as coal and iron ore, ascended by $977, resulting in $50,708.

Analysts have accredited recent gains in the index to a net rebound in commodities demand, combined with shipping constraints, especially in China. Renewed coronavirus constraints in China could influence demand and that may be apparent in the weeks to come, stated Rebecca Galanopoulos Jones, head of research at Alibra Shipping.

Jones remarked, “But globally, demand is still very strong for commodities, so I don’t think we’re going to see the market weaken in the coming weeks.”

Meanwhile, Monday, Chinese coke and coking coal futures surged to record highs, as market rumours about a suspension of Mongolian coal imports over COVID-19 fueled fears of tighter supply of the steelmaking ingredients.

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The panamax index climbed 24 points, equivalent to 0.6%, to its highest in five weeks at 3,809.

Average daily earnings for panamaxes, which usually takes in coal or grain cargoes of about 60,000 tonnes to 70,000 tonnes, rose by $219 to $34,282.

As per Refinitiv Eikon data available since 2017, the supramax index furthered 27 points to 3,303, an all-time high among smaller vessels.

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