Too many ships and/or an obsolete economic indicator?
November 21, 2015 10:05 PM Subscribe
The Baltic’s BDI index, which gauges the cost of shipping resources including iron ore, cement, grain, coal and fertilizer, has dropped to 498 points and is over 95 percent down from its all-time high of 11,793 points in 2008 before the financial crisis first hurt the sector. This index can be used as an overall economic indicator as it shows where end prices are heading for items that use the raw materials that are shipped in dry bulk. It’s important to keep in mind, though, that what the index is measuring isn’t the use of those commodities, but the shipping of them. Judging by wait times at the Panama Canal, you'd think things are busy but that traffic jam seems to be easing.
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