Key Points
The Baltic Dry Index, the most-widely followed gauge of prices to ship dry goods like coal and iron ore, has almost doubled since the start of September..
Indications in August that Beijing may ease up on the property sector gave the impression that iron ore may rebound, which boosted dry bulk shipping, but those hopes didnt last and rates should have fallen..
Knowing when prices will fall gives manufacturers and traders an edge in booking capacity, while being able to predict a rebound in trade is crucial for shipowners deciding whether to buy new vessels or lay up their existing fleet..
Sung Man Jung, who analyzed data for his Masters thesis at the World Maritime University, looked at the periods before, during, and after the 2008 financial crisis to isolate the factors affecting the Baltic Dry Index..
With the global economic outlook worsening, as evidenced by the International Monetary Funds recent downgrade, theres no reason to hope for a rebound in trade and shipping prices..
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