BDI Free Fall

The Baltic Dry Index (BDI) was trading at around ~1,387 points on August 17th, comparing to ~2,145 points on July 20th and versus ~3,253 points on May 25th, 2022, ~2,420 points on March 30th, 2022, ~1,644 points on January 19th, 2022, ~2,300 points on December 22nd, 2021 and vis-à-vis ~3,350 points during November 2021. That level compared to the 4,050-4,060 pts of October 27th, 2021 and to a trading level of around 5,380 pts on October 13, 2021. The above also compared to the trading level of 4,962 pts at the end of September 2021.

Concerning the period before that, the Baltic Dry Index traded at around 3,650 points in the middle of August 2021 versus 3,281 points on August 4th, 3,058 points on July 21st, 3,179 pts on July 5th, 2021, and 2,420 pts during May 2021.

Our previous blog a couple of weeks ago, with the BDI at around 1,817 points, ended as follows: “…It is true that we have not been expecting the BDI to be trading well below the 2,000 pts level as it finally did, being mainly affected by expectations over a grim global economic outlook and a tough recession down the road. Still in our view there is no sufficient evidence, as yet, to support the above especially pessimistic scenario and therefore we would expect the BDI to show some signs of an upcoming short term reversal. …”

BDI’s free fall of over the past 3-4 weeks has caught us by surprise as it discounts in our view a quite big recession of the global economy down the road. Inflation and interest rate hikes continue to be a great concern of the markets in general with the pace of growth in major economies, and especially in China, being once again a source of pessimistic sentiment. With the dry bulk market at this fragile state, as suggested by BDI’s sharp correction, we would expect a quite volatile pattern for the index in the short-term horizon. The current BDI levels bring us back to the era of the Covid outbreak during 2020 whereas from a technical analysis perspective they could act as a support level and help the market loosen its current bearish momentum.

BALTIC DRY INDEX as of August 17th, 2022 (latest price and intraday change):

BALTIC DRY INDEX as of August 3rd, 2022 (latest price and intraday change):

BALTIC DRY INDEX as of July 6th, 2022 (latest price and intraday change):

BALTIC DRY INDEX as of June 8th, 2022 (latest price and intraday change):

BALTIC DRY INDEX as of May 25th, 2022 (latest price and intraday change):

BALTIC DRY INDEX as of April 27th, 2022 (latest price and intraday change):

BALTIC DRY INDEX as of April 13th, 2022 (latest price and intraday change):

        Source: Bloomberg

FIGURE 1: Baltic Dry Index (BDI) (in USD) | April – August 17, 2022
[Bloomberg ticker: BDIY:IND, BDI Baltic Exchange Dry Index]

Source: Bloomberg, Trading Economics, https://www.marinevesseltraffic.com/ , www.investing.com

FIGURE 2: Baltic Dry Index (BDI) (in USD) | 2013 – August 17, 2022
[Bloomberg ticker: BDIY:IND, BDI Baltic Exchange Dry Index]

Source: Bloomberg, Trading Economics, https://www.marinevesseltraffic.com/ , www.investing.com

FIGURE 3: Baltic Dry Index (BDI) (in USD) | Last 36 Years up to August 17, 2022
[Bloomberg ticker: BDIY:IND, BDI Baltic Exchange Dry Index]

Source: Bloomberg, Trading Economics, https://www.marinevesseltraffic.com/ , www.investing.com