This page has been archived and commenting is disabled.
Baltic Dry Index Slumps To Lowest Since January 2009
The apparently critical-when-its-going-up-but-ignore-it-when-it-is-falling index of the cost of dry bulk goods transportation has 'crashed' in the last few weeks to its lowest level since January 2009 (back below 1000 according to today's levels). Whether this is seasonal output differences or weather impacts, it seems clear that lower steel output in China and a decline in European imports is having its impact on global trade. The index has fallen for 19 days in a row, down almost 50%, its largest drop since the harrowing period of Q4 2008.
The change over the past 19 days (of freefall) is almost 50%, its largest drop since Q4 2008...
and only the third largest ever monthly percentage drop in dry bulk rates...
Charts: Bloomberg
»
- 17398 reads
- Printer-friendly version
- Send to friend
- advertisements -
Overcapacity...bitchez!
Only when it goes down. When it goes up, it's due to strong economic demand.
Now now Escape key, you can't write such things on a board full of decent men, can you? :-)
ori
I don't know how many times I have to point out my avatar is Anna Chapman, incompetent, but sexy Russian spy.
Damn, I was hoping you were Anna. There goes that fantasy.
humpty dumpty....etc... still, it was very innuendo filled. Goes up, comes down, economic demand...anyways... Anna..... well, but me? I look exactly like my Avaatar.
;-)
ori
Need an update.....as of Jan.31, 2012, the BDI is now down to 702!
http://www.bloomberg.com/quote/BDIY:IND
you know 'escape key' also has a freudian connotation which adds fuel to the argument; it all depends whose key it is...
Look at your keyboard. Top left. There it is. That's all there is to it.
Bloody hell, some people have a lot of time on their hands.
You love the attention, you little hussy.
-Chumblez.
chumbawamba,
Where did the credit card article go. The one you cited your court action.
One must challenge credit card companies procurement of money, as there is none.
Therefore the credit/money is created based upon YOU, your capital letter, black law, birth certificate/contract name, thus the money is yours.
One "can" force complete return of money with interest. Dismissal of charge and complete return of credit is easier.
Look at the orders for boats made in 07-08 and their delivery dates....
These guys took a trend and a ruler and, well, you know what happens next....
You really see it in tankers.... NAT was a great company with a fantastic balance sheet but in a business that is in secular decline...
Only shipping worth looking at is LNG tankers... Days rates are excellent. Check out TGP.
I don't disagree that a glut emerged, but I think it's ridiculous to only consider those two factors as the sole explaination for BDI movements...
Anyway, it's a basic supply/demand issue, which will be worked out - a malinvestment, if you like (one of many these days, it seems).
Go to www.infoline.isl.org
and download Vol 55 Issue 4 (the free excerpt at least)
The dry bulk fleet exploded in size with 2011 being the biggest year for net additions ever...
Edit: sorry, should have included "Shipping Statistics and Market Review"
Demand Destruction....glitches!
ori
Transitory
Transitory
Well Duh, many more such companies in the same boat. Infinite growth with finite resources, I think not. All companies need to start identifying and servicing the local markets again. Bullish for the upcoming shine season. Especially if gas makes a big move up, Bring it.
I used to trade with china and india in period 1994 to 2006. I was exporter to East. All those containers had a circular life and used to go back half empty on those container behemoths! East-West trade to Eurozone was booming whereas exports to Chindia were lagging. I got good rates on containers as exporter to Chindia! It was 20-30% of going rate in other direction!
That's the asymmetric trade personified that created the current debt mountain in west. Baltic rates good indicator of world commerce a bit like the marginal cost of oil barrel (Brent).
I will confirm this. Likewise, we have enjoyed shipping our soybeans, pecans, and other commodities to Chindia, certainly cheaper than shipping to the brits.. Pecans in particular are up over 400% since 2001. Funny how people still like to eat certain things.
is that a head and shoulders in 09-10
Plunging aggregate demand says Bill Gross.
Deflationary depression on the way....
Hire Carnival captains and increase insurance policies. Voila'! Fixed.
That was all my gold on that boat!
Kind of a Froidian slip in respect to Italy?.. No?
The whole thing was just a dry run for somer Goldman fuckers to get their gold out of vaults under NYC and shipped to a Greek Island... Oops ~ ship went down... (divers waiting underneath)...
So.. where is the bad news?
Seasonal is my guess And yes we will be ignoring. It is going down after all!
Nope. Not overcapacity (although it may be related). This is declining global trade. Dry goods = commodities primarily. China's demand is declining. Either they have found miraculous new sources in the Middle Kingdom, or things are slowing down.
One can only build so many pyramids before the slaves figure out that it is just an illusion of prosperity.
The Baltic Dry Index is going to have to come up with a chart of transports of "1"'s & "0"'s on Euro - Dollar swaps traffic...
I'll bet that would look pretty bullish...
Whe BDI hits 3 figures, it's not good. Remember last year? It flirted at these levels. And then for no reason, went right back up.
But annnnyways, come what is comign in March, all of them ships are going to become critical (Modified troop carriers, weapon smuggling, oil movement).... you know, standard war-time shit.
Then the BDI will not matter.
But till then, it screams DEFLATION.
ori
/truth/
Might I add I called it yesterday. Only I was somewhat optimistic thinking that it would be triple digits on Wednesday.
But, that's me! always looking at the sunny side of things... now prepare for WWIII.
gene, positivism such as yours is a great balm to the system.....I think. As is your propheticism a threat. Eh?
We are still at T-22 hrs for Wednesday's close. I'll stay positive with you. ;-)
Gene, do you realize that every morning (hopefully for your sake), you let out a load of Bullshit?
ori
leo
Bullshit? How do you mean? Like Harry Frankfurt defined or Rachel Maddow type?
I'm sad now. I always prefer to think of my work here as shenanigans. You know, fun and saucy. :(
Lighten up Taurus...... get it? Every morning, lighten up taurus... it was a joke...
O^O
I missed it, I'm very emotionally insecure. I'm now disappointed in myself because it was a good one.
ORI, as an aside you might enjoy this exchange with one of the Hedges resident blowhards:
2066422
Flak, I saw that. Just crazy...even the whole baseball guarded acceptance thing...felt there was no point diving in. One less person to respond to. The concept of what people consider authentic exchanges is interesting here. As is the "It's an American Site Dammit" Jingoism.
I notice that red arrows start to shoot up in the entire comment section once the american population wakes up.
Anyone else notice that? And Bitchez and Fuck usage goes up exponentially too.
Interesting I think......
ori
Are you suggesting that the vulgarization here rises as our NA (not Narcotics Anonymous... I believe) friends arrive to the forum?
"I only smoke in the early morning and sometimes the late morning and then in the early afternoon and late..." ~ Sum Stona
Yup, that is exactly what I am suggesting.
ori
So you did file that away as some sort of victory? That isn't pathetic at all.
No, I filed it away as an example of a blowhard getting his comeuppence....
He is a hateful self-serving obfuscating prick, a master of strawmen, ad hominums and red herrings...
If I had not already nicknamed another poster, Grima aka Wormtongue, then this shithead would have the honor...
He likes to call bullshit in matters of opinion, whereas I limit my calls of bullshit to matters of fact....
There is a big difference between the two....
It's nice to see him eat crow....
The BDI dip last year was a precursor to the economy dipping somewhat in the first half of the year. Some said we would double dip there but the ECRI was very clear: no not yet and they were right. But at the moment the ECRI is very clear (love the language they use) that we're already in a global recession. Expect the BDI not the recover sharply any time soon. I'd say the endgame has started...bitchez!
Christmas is over fer sure.
Not for me. I held off on purchases of new items.
I'm getting items for 70-80% off their pre-Christmans retail price.
Some of the deepest discounts are now in hunting related-outdoor items.
dry index = dry powder
coming to a nation near you!
pm, dry powder w/brass and bad green paper(for now).
so whats in the ships still runnin-any aks?
Only AKs. Well, and a lot of ammo.
I predict the Dry Powder Index (DPI) to explode this year! ;-)
I was wondering when someone was going to mention it. I have been monitoring the crash. It is a straight line down on the chart.
We got QE out of both drops this large. Makes you think.
Wow, I didn't realise that it went from near 12000 in 2008 down to near 1000 today.
Imagine if the DJIA followed a similar trend...!!!
I know its not the case but this is not good for world trade; motor to current global model.
too much shit man - world a wash in shit we don't really need.
and the stuff we need; well, will be manipulted to fuck the little guy thanks fed, ecb and the fucking idiot phsycopaths that got to power by the majority with their head up their a$$. well, we get what we deserve, at least what they deserve, cause we got a plan(uh huh :)sure fuckin right on ruffus...
deflation/inflation same as 2011.
Huge drop in worldwide demand for Chevy Volts
It'll tick up next month when all the shit that was returned to stores after Christmas gets shipped back to Foxconn...
Nothing get's shipped back, it is manufactured so badly that it's cheaper to thow it in the trash here in the states to save on the trash disposal costs in China.
That happened a few years back... I ordered a greenhouse & there was nothing wrong with it but they sent me the wrong size... I told them I'd send this back to get it replaced... They said "keep it" (and sent me a second one)... Now I have two...
Should be anyway. Electric cars are a failure.
Financial Newbie here,
How do I square this, BDI, the amount/cost of shipping, which ostensibly a country like China MUST do, going into the flusher, when the Chinese announce boffo GDP numbers of 8.5%?!??!?!?
They wouldn't be lying, now would they?
•?•
V-V
Yes, but the S&P is nearing 1300.
Just one more rally, then...
It's not a problem. The tear gas, rubber bullets and riot shield trade is about to take off...those shipping containers will be full to capacity in no time.
Stock Futures Rally Amid Global Economic Data
Fox Business - 1 hour ago ES +9 Perhaps integrative therapy would be of some assistance?
Bernanke and the Federal Reserve Banksters taking more and more stimulus to juice a debt saturated US. Loans on housing, buisiness and student loans.
The US kids are so saturated with student loans it will take decades to deleverage. Baby boomers are retiring an will need to scale back.
He doesn't know what else to do; the monetarist playbook has one page that isn't even filled up after double-spacing.
I doubt he'll ever recognize the futility of twiddling the money supply...1/2, 4/8, 32/64...whatever Ben...it's still not growth.
That's because were in a recovery = green chutes.
In the words of whom ever adjusts the unemployement stats. Everything is fine.. Look! San Fran is winning!
And the stock market rallies like its 2008 oil orgies all over again (when oil rallied to $147 on Fed easing euphoria while the US was already in the worst recession since the great depression -- oil peaked in July 2008 and recession started in December 2007, six months prior to oil peaking).
Booyah!
Baltic Dry Index: 974 (-39)
B Capesize I: 1631 (-50)
B Panamax I: 1161 (-45)
B Supramax I : 927 (-22)
http://www.youtube.com/watch?v=nBfWNAoZUZk
A deflationary whiff in the air, but seems stocks just don't care.
The ws bull trap is set, the sheeple may just show up yet.
China GDP up more than expected, BDI down. This can only mean one thing. China has stock-piled all commodities it needs in its warehouses.
Buy the close, sell the open.
Ive followed the BDI for years and still don't put much reliance on it. There are seasonal issues, there are HUGE overcapacity issues, there are companies like Vale taking their shipping in house http://www.reuters.com/article/2012/01/03/us-vale-china-idUSTRE80201I20120103, there are port expansions going on cutting down port congestion, there are desperate shippers....etc, etc. There's just a whole slew of ills in the industry. And despite the fact that this is a large drop, the BDI is historically extremely volatile and I wouldn't read too much into it.
if you have 100 ships that NEED to move 101 loads of cargo right NOW, the BDI gets bid up quickly because no one wants to be the guy that waits. BUT if you have 100 ships and only 99 loads, none of the shippers want to be the guy missing out on a charter so they accept lower and lower rates, leading to a feedback loop of sorts.
March 30, 2011 (Bloomberg) -- China Cosco Holdings Co., Asia’s largest shipping company by market value, forecast a 32 percent drop in dry-bulk traffic this year as expansion in the global fleet outpaces demand.
Commodity shipments will slump to 959 billion ton- nautical miles this year from 1.42 trillion last year, the Tianjin, China-based shipping line said in a statement late yesterday. Container volumes will rise 9.4 percent to 6.8 million, it said.
Global dry-bulk capacity will expand 14 percent this year, outpacing a 6 percent rise in demand, the shipping line said, after China financed orders for new vessels during the global recession to help prop up shipyards. The capacity increase has caused the Baltic Dry Index, a commodity- shipping rates benchmark, to drop 47 percent in the past year.
The good news is that building new ships keeps folks employed. Once they are built they also need crew. All good.
Ocean carriers face a growing capacity glut in 2012, especially on the key Asia-Europe trade lane, as ship deliveries accelerate from last year while cargo demand weakens over the coming 12 months, Alphaliner forecast. The global container ship fleet is set to grow 8.3 percent, or 1.28 million 20-foot equivalent units, this year. The growth will outpace the 7.9 percent expansion in 2011, when shipyards delivered 127 vessels of 1.23 million TEUs, the container market analyst said. The growth in demand, by contrast, is forecast to slow to 6.5 percent in 2012 from an estimated 7.7 percent in 2011. Almost half of the ships slated for delivery in 2012 are above 10,000 TEUs, most of which are earmarked for deployment on Asia-Europe routes. Despite the looming overcapacity, carriers ordered 239 ships of 1.77 million TEUs worth USD19.5 billion total in 2011, according to Alphaliner. The order book reached 620 ships of 4.3 million TEUs at the end of 2011, representing 28 percent of the current fleet of 15.4 million TEUs. http://www.supplychainasia.org/latest-news/industry-news/4378-ocean-carriers-face-a-growing-capacity-glut-in-2012.html
Edit; BDI index applies only to bulk carriers (think iron ore, coal and grain) and not container ships. My mistake.
OK, that could partially explain why it is where it is. Thanks.
meanwhile, BDI is at 974.
So a question for you.....
If all bad economic data will result in more easy credit/money printing which will improve the economy, and good economic data means the economy is getting better, why worry about anything any more?
Don't fight the Fed? I will now go and dutifully buy a triple leveraged ETF and sock it away for my children's nest egg. Yep...just sit back and watch it grow.
Thanks bankers. I love you.
Baltic Dry vs Gold
Baltic Dry Index
Big Mac Index