Ocean bulk freight rates continue down

Baltic Dry Index down 40% since May

By Dave Hannon -- Purchasing, 8/27/2008 11:48:00 AM

With demand for bulk materials in China slowing due to several factors—notably the Olympics and weather-related problems—bulk commodity shipping rates have plunged recently. The Baltic Dry Index on the Baltic Exchange, which measures dry bulk shipping rates, has plunged more than 40% since its peak in May and currently sits at 7,115. And the plunge might not be over yet.

“The Baltic index has further to fall and that is going to drag down shipping stocks more because the rates for shipping commodities has a big impact on their earnings,'' said Yoshihisa Miyamoto, an analyst in Tokyo at Okasan Securities Co. in a recent Bloomberg report.