The Baltic Exchange’s main sea freight index on Thursday posted its biggest one-day percentage decline in six years, pressured by depressing demand for dry bulk vessel segments.
On its first day of trading in the new year, the Baltic index , which tracks rates for capesize, panamax and supramax vessels that ferry dry bulk commodities, fell 114 points to 976 points, its lowest level since May 2019.
The overall index declined about 10.5%, posting its biggest one-day percentage drop since January 2014.
“Some of it represents the fact that it is the first quoting for almost a week now. We expect a bit more softness to come around and we see … China as the main locomotive behind this,” said Peter Sand, chief shipping analyst at BIMCO.
“The market as such is not strong in a fundamental way,” Sand said, adding the underlying market weakness, seen in the last few months, has seeped into 2020.
The dry bulk index fell about 61% since touching a multi-year high of 2,518 points in September 2019 and ended the year 14% lower.
The capesize index fell 304 points to 1,646 – its lowest since May 31, 2019.
Average daily earnings for capesizes, which typically transport 170,000-180,000 tonne cargoes including iron ore and coal, slumped $2361 to $11,976.
The supramax index slipped 33 points to 685.
The panamax index rates were not available.
Source: Reuters (Reporting by K. Sathya Narayanan in Bengaluru; Editing by Maju Samuel)