Baltic Dry Index

[$short]

You are correct cp. The BDI is a strong indicator
of global economic health......those rates are
scary!

[mbratrud]

I would caution the fear a bit, although definitely worthy of concern. This is in part the result of a massive build up in shipping capacity much of which has come online in the past 2 years. And the high freight numbers in 08 and even a bit prior were amplified by the 2008 Beijing Olympics.

That coupled with weakening demand for Freight largely in Iron Ore as well as Grain exports in part due to stronger North American demand do to energy policies.

It will be interesting to see what happens in the next short while and if we get a bit of bounce. I think what is noticeably different from 2008 is the recession was on before we got to these levels, as well we have some bearish fundamentals directly related to over capacity.

Good post though Cotton definitely worth heightened attention over the next while to see if we break lower yet. You should be happy though this should be friendly gold and as pointed out makes our exports more competitive.

[sumdumguy]

Time to hop on the short train.

[mbratrud]

My Bad the 2008 Lows were at the begining of recesion but had bounced back 3 months later, to pre 06 levels.

[cottonpicken]

Lots of data out there is skewed or misleading or an
outright lie.

The bdi is more accurate than many indicators.

Yes an overcapacity is there,but global trade health is
not going up or static its going down.

[mbratrud]

It would be interesting to know how much
of this traffic slowdown is products out
of China?

[bucket]

cotton

Could it also be an indicator that the grain is not there to ship?

Lets just take a moment and start questioning some production estimates. If the experts were out by lets say a couple million tonnes, how many boats would be idled?

I understand what you are saying, but I can't help to think that this time there is more than just economic slowing affecting the BDI.

Short term overcapacity will lead to some boats getting scrapped.

Short term reduction in available exportable grain could also lead to this level of BDI.

Grain companies, like the new cwb, would be wise to jump all over this opportunity.

[Fransisco]

http://mjperry.blogspot.com/2012/02/irrelevance-of-baltic-freight-index.html

[cottonpicken]

Do not know what percent of ships are dedicated to grains and any conclusion would be on broad based market.

Someone else maybe/probably follows global grain exports/imports and would know better.

The harpex index which tracts container price is also way down.

http://www.harperpetersen.com/harpex/harpexRH.do?timePeriod=Years10&&dataType=Harpex&fl oatLeft=None&floatRight=None

[cottonpicken]

Fran,it my believe dennis gartman is one of the
dumbest analysts ever to write a letter.