Baltic Dry Index (BDI)
What recovery?
Following the BDI will give you a good real time indicator of the health of the global economy. This index follows dry bulk commodities/goods shipped throughout the world, such as iron ore, bauxite, etc.
This index is now trending down again and sits at 1405.00 - which is below the 50 DMA for the past 12 months and is below it's 200 DMA since September 2008!
Some will argue that this is because of all the "new" ships coming on line, causing an over supply of shipping units. However when looking at the number of units that have come to the end of their useful life and are being broken up, or are due to be broken up, the numbers are down. Although the "new" units are larger in tonnage to accommodate more cargo volume and hence cheaper operating costs.
For the past almost three years, the BDI 200 DMA has been essentially flat lined, but is now starting to trend down again. This does not portend a recovery in progress. If anything these past 33 months in the Index, indicate stagnation in the dry bulk carrier shipping segment, with darker clouds on the horizon as the 200 DMA trends down.
