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Jun 05, 2012, 01.50 PM IST
Mecklai graph of the day - The Baltic dry index is an assessment of the price of moving the major raw materials by sea. It takes into consideration 23 shipping routes measured on a time charter basis and it carries a range of commodities including coal, iron ore and grain.
The Baltic dry index is an assessment of the price of moving the major raw materials by sea. It takes into consideration 23 shipping routes measured on a time charter basis and it carries a range of commodities including coal, iron ore and grain.
As it can be seen that the Baltic Dry Index (BDIY) declined sharply by 2.1 percent to 904 points and we cannot rule out a further dip in the index amid a global slowdown. In the past 26 years since the Baltic index came into being, the index has never slipped below 650 points and the current fall in the Baltic Index has raised serious concerns among shipping companies.
We can expect further declines in the index due to weak global economic growth, and overall slowdown in the Asian giant China as it consumes a very big chunk of the global commodities mainly steel and iron ore.. The shipping markets would continue to struggle as the supply of vessels overwhelmed demand for cargoes, and the situation cannot be described as anything but dramatic Things are expected to get even worse over the coming days as the slack demand continues and only a strong revamp in the global economy can support the sliding index.
The below graph shows the movement of Baltic Dry Index over the past 5 months.
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