BDI’s Return to Historical Average Territory       

[Thursday January 18th, 2024]                                 

The Baltic Dry Index (BDI) settled at around ~1,308 points (USD) on January 18th, 2024 versus ~3,143 points (USD) on December 6th, 2023 i.e. the date when we released our previous blog. Previously, the Index had settled at ~1,523 points (USD) on November 7th, 2023 and had traded notably higher at 2,105 points (USD) on October 18th.    

In the earlier period, and specifically from May 10, 2023 until June 2, 2023 the BDI recorded a significant drop i.e. from 1,633 to 919 points, while in the immediate previous period i.e. from March 7, 2023 to May 10, 2023 the Index was trading along the channel of 1,300 – 1,650 points.   

From June 2020 up to December 2023, the Baltic Dry Index has been almost convincingly trading above the psychological level of 1,000 with the exception of two periods, i.e. firstly the period January – February 2023, when the Index hit a low of around 500 points, and secondly the period May – June 2023 as mentioned above. In the beginning of July 2023, the Index also slipped below 1,000 for a few trading sessions.   

Our previous blog, on December 6th, 2023 with the Index at ~3,143, was reading as follows:

“…The current spike in BDI levels, from below 1,400 to above 3,300, has augmented the volatility levels of dry bulk market and may be a harbinger of large swings and abrupt movements for the following weeks. With the volatility skyrocketing, we tend to believe that the current trading levels of BDI are unsustainable and therefore we would expect a price correction in the following period which can be as sharp as the recent surge in BDI levels. The current backdrop of the market is considered favorable as it points towards weak supply in terms of tonnage but also to more optimistic equity markets that can also favor shipping stocks. …”    

The dry bulk market landscape remains unpredictable and volatile as geopolitical tensions along with readjustments of sea transportation routes due to the Red Sea crisis, as well as uncertainty over the timing of interest rate cuts within 2024 might lead to ups and downs in the broader economic sentiment impacting freight rates. In the short-term horizon, we would anticipate a potential consolidation of the BDI around or close to the historical average levels.   

BALTIC DRY INDEX as of January 18th, 2024 (latest price and intraday change):    

BALTIC DRY INDEX as of December 6th, 2023 (latest price and intraday change):    

BALTIC DRY INDEX as of November 7th, 2023 (latest price and intraday change):    

BALTIC DRY INDEX as of October 4th, 2023 (latest price and intraday change):    

BALTIC DRY INDEX as of September 1st, 2023 (latest price and intraday change):    

BALTIC DRY INDEX as of March 1st, 2023 (latest price and intraday change):    

BALTIC DRY INDEX as of February 15th, 2023 (latest price and intraday change):    

BALTIC DRY INDEX as of October 12th, 2022 (latest price and intraday change):    

            Source: Bloomberg   

FIGURE 1: Baltic Dry Index (BDI) (in USD) | August – January 18th, 2024    

[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) | 2014 – January 18th, 2024    

[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 39 Years up to January 18th, 2024    

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

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

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