BDI Retreated from its Recent Highs

The Baltic Dry Index (BDI) was trading at around ~2,514 points on June 8th 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 previous 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 3,253 points, was reading as follows: “… So the dry bulk rally of the past two weeks came with a little surprise to us even though we continue to uphold the scenario that 2022 will see BDI levels well above the ones of the years 2020 and 2019 but not as high as the ones of the second half of 2021. Given the backdrop of a macro and monetary environment with lot of uncertainty, i.e. inflation pressures, interest rate hikes, possible economic slowdown, energy and supply chain disruptions, it would make more sense to us to anticipate some rationalization of these high levels of optimism in the dry bulk market going forward. …”

Indeed, from May 25th and up until today, the BDI retreated its trading levels as it lost more than 20% from its recent highs. This demonstrates that BDI levels of around 3,200-3,300 points were more a speculative movement of the market and not a fundamentally justified trading level that could be sustained in the longer run. On the other hand, at the current levels of around 2,500 points -which in our view are associated with a rather limited downside risk- the BDI seems to be much closer to its sustainable historic average trading range.

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 May 11th, 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):    

BALTIC DRY INDEX as of March 16th, 2022 (latest price and intraday change):    

BALTIC DRY INDEX as of February 2nd, 2022 (latest price and intraday change):     

            Source: Bloomberg

FIGURE 1: Baltic Dry Index (BDI) | February – June 8, 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) | 2013 – June 8, 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) | Last 36 Years up to June 8, 2022    

[Bloomberg ticker: BDIY:IND, BDI Baltic Exchange Dry Index]

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