November 22, 2008

BDI value lost by 50% on low demands

It is reported that Baltic Dry Index has lost more than 50% of its value in just under 4 months, falling to 5,874 as limited demand fails to absorb an oversupply of tonnage.

It may be noted that BDI, which is a benchmark measure for the dry bulk market, hit an all time high of 11,793 on May 20th 2008, but has since fallen close to a year low of 5,615.

The Capsize average time charter rate was USD 85,862 per day, down by USD 8,163. The average time charter rate has now lost a massive USD 148,126 since it hit an all time high of USD 233,988 per day on June 6th 2008.

The dry bulk markets have tumbled in all sectors as a lack of fresh inquires, particularly from China, have failed to absorb an excess of tonnage.

China, usually a major importer in the dry bulk markets, slowed its activity ahead and during the Olympic Games last month. This dampened market rates, although at the time there still remained an expectation that rates would rebound post games. This rally in demand has so far failed to materialize and as such owners have been unable to halt the decline in rates.