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Baltic Dry Index as Lead Indicator

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shonegold
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Saturday, November 22, 2008 - 10:34 am:Copy highlighted text to 'New Message' boxEdit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



The Baltic Dry Index measures the demand for shipping capacity versus the supply of dry bulk carriers. The demand for shipping varies with the amount of cargo that is being traded or moved in various markets.

It is said that this is a reliable index which is free of manipulation unlike other indices which are subject to manipulation or massaged figures.

It is said..."People don't book freighters unless they have cargo to move"

Well you know, I sometimes wonder...has anyone ever booked a taxi and then changed their minds? .....It would also be interesting to know how much it costs to book a cargo place on a ship if you want to create the appearance of an increase in cargo movements....and then unbook it again when you are out of a given position in your commodity.

Anyway for what it is worth as a reliable indicator and a possible lead indicator for a price reversal for commodities, it will be interesting to watch but I have no intention of betting any of my hard earned until I see long term averages rolling over like a tart in a cat house....hey Archer! ;)

Looking at the weekly chart...sorry Captain Chaza can only get it weekly...it looks like it is beginning to level off from its recent swan dive from a great height.

bdi


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archer
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Saturday, November 22, 2008 - 01:31 pm:Copy highlighted text to 'New Message' boxEdit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



hey you've brutalised my saying there shoney(;->
tart in a cathouse just doesn't have the same poetry
by the way BDI has absolute rock solid support at zero







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paddy
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Saturday, November 22, 2008 - 03:46 pm:Copy highlighted text to 'New Message' boxEdit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



shonegold: You posted "it looks like it is beginning to level off from its recent swan dive from a great height."

The BDI is a leading indicator for global economy . Nothing been shipped means problems in the resource - production and manufacturing sectors. Companies in those sectors can try to delay announcing that there are problems . Good case is BHP . They held off as long as they could before announcing that there were cancellations of iron ore shipments.

The BDI graph showed that something was amiss since May-June of this year. In September things started to get worse and have just increased since then.

Just think on 09022008 the DSR for a Capesize vessel was $104,951 . Today that same size vessel has a DSR of ONLY $3,499 . One year ago the DSR was $174,582.

Shipping companies are going bankrupt . No manipulation of this Index.

Recently Support at 813 looked like it was going to be tested . However Index stopped short [ @ 818 ] of testing the level. since then Resistance at 860 was tested and the Index was above the level for only one day. Now looks like the Index is headed for another test of Support at 813.

The reversal in the Index was caused by some activity with Panamx and Supramax vessels. Again it appears that the activity for the Panamax class has reversed and resulting in the BDI index resuming its downward trend.

Regards,

Paddy


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morton
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any chance you could put up the BDI from March 03 to today, Would be interested to see how it compares to XJO.


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tryhay
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morton wrote on Monday, November 24, 2008 - 04:04 pm:

any chance you could put up the BDI from March 03 to today



Certainly has lead the way... bounce may not yet have legs

bdi

Longer term shows a sad & sorry tail

bdi 3 yr


Happy trading DYOR


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paddy
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Morton / Tryhay : This daily graph, shown as line as there is only a daily fixing of the Index, illustrates how the BDI has been oscillating between 860 and 813 since October 31, 2008 . On November 18 the Upper Boundary @ 860 was tested but the "breakout" lasted for only one day. Now with BDI @ 824 it appears that the Support @ 813 will be in line for a test.

Regards,

Paddy





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morton
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wow, like looking at XJO in a mirror, that is amazing. I couldn't tell how much lag/lead there was between XJO and BDI, I would imagine nil.

Is the BDI in US dollars, if so, I would imagine that Aus/US fluctuations would move the price too.


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shonegold
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"The reversal in the Index was caused by some activity with Panamx and Supramax vessels. Again it appears that the activity for the Panamax class has reversed and resulting in the BDI index resuming its downward trend."


Go on Paddy! That is darn interesting...


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shonegold
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Sorry about that Archer...sometimes only the poet themselves should read the lines to do full justice to the story...

....but then again never ruin a good story with all the facts!:D


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shonegold
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Paddy quoted..Now with BDI @ 824 it appears that the Support @ 813 will be in line for a test.

...and failed Paddy! Down to 804.

bdi


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shonegold
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Quoting Morton..any chance you could put up the BDI from March 03 to today, Would be interested to see how it compares to XJO.

This isn't exactly what you asked for Morton but thought you may find it interesting...12 month view and the All Ords but I am sure it will give you some indication. I can do an overlay but the % difference between the All ords and the BDI was too extreme and really didn't show too much detail for the All Ords but happy to do it as an overlay if you want it for 6 months or 12 months.

Sorry my replies are so late, there appears to be quite a delay between me posting and it appearing on the forum. :-)



bdi


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paddy
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shonegold posted on 26112008 : "Paddy quoted..Now with BDI @ 824 it appears that the Support @ 813 will be in line for a test.

...and failed Paddy! Down to 804."


FYI :

On November 4th Paddy wrote :

""No change in direction. - downward . Next support for BDI at 813 has held for now. Whether coincidence or not it is a Fib 0.618 level and if it is broken to downside the index will probably drop to sub 700 levels.


I also wrote : "Perhaps we might see a rebound at this level." I'm sure you are aware that for the next two days the BDI reversed and bounced for 24 points [ 2.9%]. Then as discussed some time ago the Index corrected to 818 and reversed again to test 860.

Now at 733 the next level of support is at 660.

In this drastic correction the DSR for a Capesize vessel has fallen from $235,400± to $2,548 on November 27, 2008. That is only a correction of 98.9± percent. The Capesize Index , in turn, has fallen from about 25,100 to 858. That is a drop of 96.5± percent.

I'm sure you are aware of the companies that have gone bankrupt, companies searching for suitable areas where they can mothball their vessels until rates return to a level where they can make a reasonable return.

Have a good one

Paddy


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morton
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Friday, November 28, 2008 - 01:57 pm:Copy highlighted text to 'New Message' boxEdit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



thanks shonegold, very helpful, I'll have to use this index to my trading tool box, do you know where I can download the csv data?

your blogs will be delayed as the moderators have to check new accounts to prevent spammers, after ten posts you'll be blogging in real time.


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shonegold
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G'day Paddy...missed those earlier posts of yours, I had heard about the problems they have been having with bankruptcies over the last number of months there are also those large number of new vessels on order as well, to further spice up their problems! Here is a recent report regarding the falling away of Iron Ore and the increase in their fleet supply which may well keep the pressure on them for the next year or so. http://www.balticexchange.com/media/pdf/Clarksons.pdf

...got a link you can add to the posts so I can keep up with what you are saying...Don't want to trample all over your patch.! :-)

Morton...this is the Baltic Dry Exchange site.http://www.balticexchange.com/

I am getting the weekly data from Stockcharts.com, sounds like Paddy may have his head deeply into the BSI so perhaps he can give you some more advice re the figures. They are only released once a week, so not too hard to glance at along with other Indices.

...and no worries about the time delay...nothing of what I say is all that vital...just shooting the breeze! :-)


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paddy
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Monday, December 01, 2008 - 10:44 am:Copy highlighted text to 'New Message' boxEdit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Shonegold :

I have no claim to the subject . I just started posting it some time back because I thought it was useful information. I can post to this thread to keep it all in one place . No hay problema.

For you , Morton and others who are interested here are a couple of sites where you can get data and charts.

Dryships

http://www.dryships.com/index.cfm?get=report

Data [ fixed once a day ] for BDI plus sub-indices BCI, BPI and BSI posted just after 0700 Monday through Friday.

==========
Simpson,Spence & Young Shipbrokers

Lots of charts

ttp://www.ssybeijing.com/Resources/Free_Charts.html?PHPSESSID=dd39df3a64810270ed939a61 242a07e7#

Regards,

Paddy


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paddy
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BDI / BCI

BDI 15052008 11793
BDI 02092008. 6466
BDI 01122008. 700 next major support 657

BCI 02092008 9599
BCI 01122008 833


Capesize DSR 02092008 $104,951
Capesize DSR 01122008 $ 2,364

Capesize DSR 01122007 $180,021


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paddy
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BDI / BCI

All sub-indices dropping. rapidly approaching support level @ 657.

BDI 15052008 11793
BDI 02092008. 6466
BDI 02122008. 684 next major support 657

BCI 02092008 9599
BCI 02122008 830


Capesize DSR 02092008 $104,951
Capesize DSR 02122008 $ 2,316

Capesize DSR 01122007 $180,062



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shonegold
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...and for those who like pictures....:-)

bdi


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paddy
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Looks as though the BDI will test the 860 level in the next day or so.




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paddy
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The BDI continued to travel along within the channel defined by levels 860 and 657. This last week it was headed for a test of the Upper Boundary but fell short reaching a high of 836. When the Capesize Index reversed this resulted in also the BDI reversing course and now appears to be headed back to test the Lower Boundary.



The major action in the sub-indices was in the Capsize Index [ BCI ] where it rose from 830 to 1515 points. The 685 point rise was essentially "noise" when compared to the action of the Index since may of 2008 when the BCI topped 19500. In the last two days the BCI has lost 92 points which has resulted in the BDI also reversing.



The fall in shipping rates continues to take its toll in both ship builders and shippers as evidenced by the following articles.

SHIP BUILDERS

Korean shipbuilders may miss order targets in 2008

As the global economic recession has dampened demand for new vessels, Hyundai Heavy Industries Co and Daewoo Shipbuilding & Marine Engineering Co, have missed their order goals in 2008.

But some analysts said that Korean shipbuilders fared well as they had secured enough orders to keep them busy over the next 3 years, despite the abrupt downturn in the global shipping industry.

Hyundai Heavy won orders worth USD 21.9 billion, accounting for 75.5% of its original target so far this year. Daewoo Heavy received orders worth USD 11.7 billion as compared with its goal of USD 17.5 billion.

Meanwhile analysts predicted that new orders for South Korean shipbuilders would plunge 28.6% in 2009 due to the deepening global recession.

SHIPPERS

Atlas Shipping files for bankruptcy - Report

Bloomberg reported that Atlas Shipping Group filed for bankruptcy protection, becoming the latest victim of an unprecedented collapse in the price of hauling coal, ore and grains by sea.

As per report Atlas and two other units filed the “bankruptcy orders” in the Bankruptcy Division of the Maritime and Commercial Court in Copenhagen at 10:30 AM local time.

Mr Bo Kristensen owner and operator in the statement said that “A historic drop in rental rates since August means the group will no longer be able to fulfill all its financial obligations as they fall due.”

He added that “It is extremely unfortunate, not least for all our highly skilled employees and our loyal customers.”

Mr Per Moeller MD said that the company has liabilities of about USD 150 million.


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paddy
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As suggested in the last post the BDI has continued on its way downward to test the Lower Boundary of the Channel. Having retraced 62 points from 836 and now at 774 it appears that the intermediate Support Level at 753 will be tested in the coming week.




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paddy
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There was no activity in the BDI from 12242008 to 01022009 . On 01022009 the BDI dropped 1 point to 773 . Certainly not showing any real activity in the shipping business of which commodities account for the greater part of the shipping activity.

Still appears that the Index is headed to test at least 753 . This coming week will give a better picture as to where the Index is headed.




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paddy
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Hope for BDI

Last week, with action in all three sub-indices, the BDI it broke to upside of the channel it has been in for last October.The next upside resistance is at 908 .

Also, one company is looking down the "strait" and preparing for better days .

Evergreen marine to order 100 boxships

Evergreen Marine has announced plans to spend $5.5 billion to build 100 container ships before the anticipated recovery of the global economy in
2012. The fleet augmentation will help the world's fourth largest container shipping line to move to the third slot.

In its first major shipbuilding project, the company plans to go for some 30 ships in the 8,000 TEU category, 40 ships in 5,500 TEU, 10 ships in 3,900 TEU, and 20 ships in 2,800 TEU. The company has been avoiding ultra-large ships of over 10,000 TEU.

According to reports, the company is likely to place orders with Japanese and Korean shipbuilders for the new ships.
According to Evergreen chairman Chang Yung-fa, the global economy is expected to bottom out in the second half of 2011 before achieving real recovery in 2012. He believes that with the drop in global steel prices, shipbuilding cost will plunge to $10,000 per TEU in 2011, compared with $15,000 now.

http://economictimes.indiatimes.com/News/News_By_Industry/Transportation/Shipping__Transport/Evergreen_marine_to_order_100_boxships/articleshow/3965466.cms





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paddy
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China to Consume 51.3 billion tonnes of iron ore in 2020



According to the National mineral resources program issued recently by the Ministry of Land and Resources P.R.C, in the year of 2020, China is to consume 500 million tonnes of oil, 1.3 billion tonnes of iron ore and 3.5 billion tonnes of coal. The program shows that China has been a net importer of oil ever since 1993. Mr Hu Zhicun the general planner from the Ministry of Land and Resources P.R.C said "By the year of 2015, China's oil production will be above 200 million tonnes However, this amount still falls short of domestic demand by a large extent. The above program report points out that in order to resolve oil scarcity, China must try to prove six 100 million grade oil fields.”
At present, 50% of China's oil is imported from abroad. Its oil import volume in going up by 10 million tonnes each year and the amount is still increasing now.


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paddy
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The BDI Rises and Falls like the Tide.



This past week the BDI continued its rise reaching 920. . That is until last Thursday when it reversed course and again set a "southerly" course and closed on Friday at 881.

Since November of 2008 the BDI has been confined to a "channel" defined by levels 908 and 657 . This is shown in chart BDI-1.

Chart BDI-1



The majority of the time the Index has oscillated between 860 and 753 . This is shown in chart BDI-2 .

Chart BDI-2



In December the Index started on a new course that may develop into an up-sloping channel that as of 01162009 the Upper and Lower limits were 920 and 856 respectively . This coming week will probably see the Index test 860 level and the Lower limit at 856. If the Index re-bounds then perhaps there is some possibility that a new course is in the making. Should they not hold then, in all likelihood the Index will re-test 813.

A search of the Net came up with many articles of which I selected two to illustrate the positive and negative of the recent action of the Index.

First, in my opinion, perhaps a realistic reason for the rise and subsequent fall of the BDI is from an article titled:

False signals of recovery

"According to my sources, some oil companies are starting to use layed up dry bulk ships as storage vessels for oil. With no where to store & ship oil as it flows out of pipelines, these ships are tied up in dock. Oil companies are waiting it out until oil prices rebound to sell their commodities to overseas buyers-not an encouraging sign. So yes, these ships are consigned, but not actually traveling anywhere yet-so that's why the BDI has inched upward, giving you a false positive signal."


http://smarteconomy.typepad.com/smart_economy/2009/01/when-will-the-recession-end-part-7-false-signals-of-recovery.html

Then we have the optimistic viewpoint from a Seeking Alpha article titled:


Dry Bulk Shipping: Recent BDI Rise Is Heartening



The article has a couple of errors that I have pointed out below.

"Just look at the chart below to see how much healthier the Dry Bulk Index is looking by the day. The Capesize index now stands at 15235."


Note that there are errors in the above quote and the accompanying chart. The title of Chart is incorrect as it is a chart of the BCI - Baltic Capesize Index which forms the greater part of the BDI ( Baltic Dry Index ). On the day referred to in this article the BCI was at 1864 while the BDI was at 911 having broke above Resistance at 908. This was short-lived . Three days later the BDI was back down to 881. The figure 15235 is not the BCI figure . It is the spot daily rate for a Capesize vessel in $US.


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rdumas
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Sunday, January 18, 2009 - 10:39 am:Copy highlighted text to 'New Message' boxEdit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Paddy,

Your work on the BDI index has been and continues to be excellent. Keep up the great work.


"...if one tortures a dataset long enough, it will confess to anything!"

- Andrew Lo

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paddy
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Rudy : Thanks. I have come across a couple more "snippets" and think I should comment on them. The first is what I consider to be "distorting reality" by taking an "isolated" event and ignoring the "whole" event.

From an article: """The ride was straight downhill and the index bottomed at 830 on December 2. Over the last two weeks, however, the BCI has been on a run, increasing 80% to close today at 1,514. Over the same two weeks the broader BDI has increased just 21%."""

Here is a chart that illustrates the "run" and its apparent reversal that occurred just after the article. For relative levels the numbers for Highs and Lows are :
Date ------------BCI

10202008 ---------- 1674
12012008 ---------- 830
12022008 ---------- 830
12282008 ---------- 1515
01052009 ---------- 1386
01141888 ---------- 1888
01162009 ---------- 1760



I don't disagree with the numbers - just the manner in which they are presented .

The following chart illustrates the big picture and shows that, in my opinion, what has happened since 12022008 is essentially "noise". From a High of approximately 19780 the Baltic Capesize Index now stands at 1760.




A chart that illustrates, in my opinion, even better what has taken place is the Daily Spot Rate in $US. I don't think one could find a finer example of a head and shoulders pattern . Once the price crossed below the neckline at $157,500 it dropped like a rock.



The final quote is a realistic assessment of the Index :

"""As you probably know, the Dry Bulk Shipping index can tell you a lot about the state of the World Economy. When Bulk Shipping Rates are at all time highs, the World Economy is outstanding. When Bulk Shipping Rates are as low as they have been lately, it signifies that the world economy has come to a screeching halt."""

Regards,

Paddy


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paddy
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Nippon Yusen, K-Line Slash Forecasts as Trade Slumps

Nippon Yusen K.K., Mitsui O.S.K. Lines Ltd. and Kawasaki Kisen Kaisha Ltd. Japan’s three largest shipping lines, slashed full-year profit forecasts as slower growth in China cut demand for commodity transportation. Nippon Yusen fell the most since 1974.

Nippon Yusen expects net income of 73 billion yen ($816 million) in the year ending March 31, 48 percent less than a previous forecast. Kawasaki Kisen cut its forecast 58 percent to 30 billion yen. Mitsui O.S.K. expects net income of 130 billion yen, 33 percent less than earlier forecast.

Demand for transporting iron-ore, coal and other commodities has tumbled, pushing the Baltic dry index, a measure of commodity-shipping rates, to a record decline last quarter. Asian container shipments to the U.S. are also declining and Japan’s shipping lines have cut their services.

“Next fiscal year’s profit is going to be worse,” said Yoshihisa Miyamoto, an analyst in Tokyo at Okasan Securities Co. “Even a small drop in the level of bulk commodity transport has a big impact on profits.”

Nippon Yusen, which also cut its full-year dividend forecast to 15 yen from 26 yen, plunged 16 percent to 430 yen at the 3 p.m. close of Tokyo Stock Exchange trading. Mitsui O.S.K. dropped 12 percent and Kawasaki Kisen, also known as K-Line, slid 13 percent.

China’s Economy

China’s economy expanded at the slowest pace in seven years last quarter amid factory closures. The world’s biggest steelmaker and buyer of iron ore grew at 6.8 percent in the fourth quarter, compared with a 9 percent gain in the previous three months. Also, China’s exports fell the most last month since 1999.

The Baltic index, a measure of commodity-shipping rates, tumbled 89 percent last quarter, its biggest drop on record.

The index averaged 1,169 points in the three months ended Dec. 31, compared with 10,318 points in the same three-month period a year earlier.

In the third quarter, Nippon Yusen’s net income dropped 50 percent to 19 billion yen. Mitsui O.S.K.’s profit plummeted 77 percent to 13.6 billion yen and Kawasaki Kisen, also known as K- Line, had a loss of 10.5 billion yen.

Separately, Kawasaki Kisen’s senior managing executive officer Tetsuo Shiota said the company will reduce its fleet expansion plan by 12 percent to about 500 ships by the end of March 2010. K-Line plans to take delivery of about 40 new ships next fiscal year to help it save 30 billion yen in costs, Shiota said.

The move follows expansion slowdowns announced by Nippon Yusen and Mitsui O.S.K earlier this month. Nippon Yusen is cutting its expansion by up to 100 vessels, according to Japan’s Nikkei newspaper. Mitsui O.S.K. plans to reduce its expansion by 50 ships.


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This last week the BDI ended up 90 points at 1070 just below resistance level at 1073 with the next level at 1096.

The BCI ended down 51 points at 1981. From 01202009 to 01262009 the index climbed to a level of 2049 and then from 012272009 to 01292009 it reversed and dropped 77 points to 1972 and then on 01302009 it gain 9 points to close at 1981.

Even though there has been some activity the Indices are still far short of their Major Highs set in May - June of 2008.

------ Index ----- Major High ------ 01302009

------ BDI ---------- 11,793 ------- 1070

------ BCI ---------- 19,500+ ------- 1981

--- BCI-DSR -------- $233,000+ ----- $17,410







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Shippers Get A New Year's Lift




Recent rise of Baltic index likely reflects the start of the new lunar year.

The long-suffering shipping industry has been on a minor roll for the past two weeks, but you can credit that more to the vagaries of the Chinese character than a renewal of world economic growth.

The Baltic Dry Index, an indicator of shipping prices, climbed 22.7% in the last two weeks. It is up 52.9% since the beginning of December, but for past year, the index is off 82.5%. That steep fall puts any recent increases in context.

Chinese New Year is the likely explanation, according to the chief executive of the company that runs the gauge of shipping costs.

Jeremy Penn, chief executive of the Baltic Exchange, said the index’s recent firming resulted from a rush of orders for materials like iron ore and steel ahead of the week-long holiday last week. He said while this increase can not be ignored, it should be seen in context of the larger losses the index has suffered the last 12 months.

“One has to be cautious and see the index in terms of short-term market effects rather than anybody signaling 'Great it's all over,'" he said. “What you have to remember is that after a long period of a boom, freight rates have bumped along a bottom."

Some investors in recent weeks have bought into shipping stocks by looking at the dipping of the Baltic Dry Index. (See "Abandon Ship.")

Penn said it will take a week or two for the Chinese New Year-effect to play itself out, but he wouldn’t say whether that means the index would continue its climb or settle down.

A research note from JP Morgan said the Baltic Dry Index has been pushed up because of the iron ore trade and anticipation that China will need more of the material as it ramps up its internal economic stimulus package.

The index "is a China property and infrastructure story,” according to the note. JP Morgan added that about 77.0% of the largest, Capesize vessels have been employed to ship cargo to China since last month, and that about half the steel used in China is for properties and infrastructure development.

Last week, Prime Minister Wen Jiabao of China indicated that the country's economy might be improving (See "Premier Wen Says, 'Don't Worry' "), although he said on Monday that the world economic crisis has not yet passed.


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Are They Setting the Hook ?

The BDI has continued to act like a "rising tide" . The last two days have seen triple digit increase in the Index with increases in all sub-indices. Whether this is a "Chinese New Year" phenomenon or the start of recovery remains to be seen .
The BDI has now risen 638 points above the Upper Boundary of the Channel it sailed along since October of 2008. It has now risen 835 points from the Low of 663 set on 12202008 . That may seem like a huge move from 663 to 1498 . However it needs to be put in perspective . The Index dropped from 11793 to 663 for a total of 11,130 points or 94.3% . It has now regained 835 points or 7.5% of what it lost.

Still a long ways to go to reach those level where the Daily Rate for a Capesize vessel was $200,000+ compared to $26,495 today.


}


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paddy
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Ocean freight costs surge 50% on the week

The Baltic Dry Index, the benchmark for freight costs for dry bulk commodities such as iron ore, coal and grains, rose sharply again on Friday, taking its gains over the past week to more than 50 per cent on signs of a recovery in Chinese iron ore imports.

The London-based index on Friday climbed 9.6 per cent to 1,642 points, the highest level in almost four months and more than double its December 22-year low of 663. The index has risen 53.5 per cent this week.

Shipping brokers said the recovery was driven by a pick up in Chinese demand for iron ore. But they warned that it was more a correction from the extreme fall between October and December of last year, than a sign that the world has emerged from the financial and economic crisis.

Even if this week’s jump is impressive – the index rose almost 15 per cent on Wednesday, the largest one-day increase since 1985 – the Baltic Dry is still well below last year’s all-time high of 11,793 points. The index has a history of wild swings and shipbrokers were extremely cautious, warning that the rise was not the prelude of the end of economic woes.}

In the short term, shipbrokers and mining companies’ executives see signs of stronger freight demand, particularly for the largest vessels, or Capesizes, as the Chinese steel makers return to the market after running down their ore inventories, which hit record levels in September and October.

Peter Norfolk, head of research at shipbrokers Simpson Spence & Young in London, said there had been an increase in iron ore chartering from Brazil, and to a lesser extent from Australia, to Chinese ports. “There is a squeeze of tonnage availability in the short-term”, he said.

Marius Kloppers, chief executive officer of BHP Billiton, one of the three largest miners of iron ore, said this week that the Chinese steelmakers were “coming back into the market and buying”.

Spot iron ore prices in China rose this week 5 per cent to $84.5 per tonne, the highest level since early October and 33 per cent above of $63.5 per tonne set late last year.

Alan Heap, a commodities analyst at Citigroup in Sydney, said that the “catastrophic demand” declines in the fourth quarter of last year were “amplified by de-stocking.”

“Port inventories [of iron ore] in China are about 20 per cent lower than September highs,” he said. But he warned that beyond “a potential short covering rally, underlying demand will likely remain weak through to the second half of 2010”, adding that iron ore prices will remain under pressure.

Shipping brokers said that most of the Capesize vessels that were left anchored at ports during the past few months because of a lack of demand were now back in the market.

The freezing of global trade late last year as banks tightened the issuance of letters of credit – a critical financial instrument to grease the global trade machine – also exaggerated the drop in the Baltic Dry Index. As trade slowly recovers and banks ease some of their restrictions, the pick up in activity is boosting now the index.


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Is the Recent Rise in the BDI the start of a New Dawn?

Reports of newly signed contracts for Capesize vessels to haul iron ore from Brazil to China. Star Bulk Carriers reported one such contract but did not include the DSR for the contract.

"" Contract of Affreightment (COA)

The Company has entered into its first Contract of Affreightment (COA) with Brazil's Companhia Vale do Rio Doce (VALE). The contract calls for transporting approximately 700,000 tonnes of iron ore between Brazil and China in four capesize vessel shipments with the first such shipment scheduled to commence during the first quarter of 2009.

Redeployment of Star Alpha

On February 5, 2009 the Company committed the Star Alpha to the COA contract referenced above to transport iron ore between Brazil and China. The vessel was redelivered to Star Bulk by its previous charterers approximately one month earlier than the earliest date allowed under the charterparty, after having completed repairs of 25 days duration. ""

The bulk of the recent rise in the BDI and the BCI has occurred in the last three days with the BDI rising from 1148 to 1642 and the BCI rising from 2093 to 2999 . Now we have to wait and see if the "tide" will continue to rise . The answer lies in the chart and so far he is not talking.


"I have nothing to
say at this time "


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paddy
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There has been lots of articles on the "meteoric" rise of the BDI and one of it's sub-indices the BCI.
The BDI bottomed on 12032008 at 663 . On 01092009 it broke above the Upper Boundary of a Channel that it had meandered in since last November. On 01192009 it retraced to test the 860 level but reversed at 868 and since then has risen to a Close of 1642 on 02062009.




The majority of this rise has occurred in the last 4 business days of last week where due to the heavy weighting of the BCI the BDI rose 543 points from 1099 to 1642. This is good but needs to be looked at in context as to what has taken place in the Index. The rise from the Low of 663 to 1642, a rise of 979 points is only a recovery of 8.8% of the 11130 points that were lost when the Index plummeted from 11,793 to 663 .



As mentioned, the BCI [ Capesize Index - a sub indice of the BDI ] is the major component of the BDI and has also seen much activity in the last four days. Last week , in four days, the BCI rose 995 points rising from 2004 to 2999. Again the numbers need to be viewed, in the big picture, as this Index was at one point above 19,580 only to drop to a Low of 1337 on 12242008 . . Then rose to 2049 on 01262009 only to retreat to 1918 on 01302009. Then on 02022009 it broke above 2000 again Closing at 2004 . Then in four days 995 points were added to the Index which closed at 2999 on 02062009.



When the BCI bottomed at 1337 it had lost some 18,225 points. The 1662 point rise from 1337 to 2999 represents 9.1% of that which was lost and of that 995 points or 5.46% was regained in the last four days.
If one plots the data for the period December - February on semi-log paper the points fall within an up-sloping "Channel" [ post #1320 ]that presently has boundaries at 2200 and 3000.

For the BDI the similar "Channel" has boundaries of 1000 and 1500.
It is a good start on regaining that which was lost but for some shippers the "turn of the tide" came too late. If the "tide" keeps rising perhaps we will see the BDI test 1750.


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China Cosco, Shipping Stocks Gain on Rates Outlook


It was reported in Bloomberg that : " China Cosco Holdings Co., the world’s largest dry-bulk carrier, led gains by shipping stocks after the Baltic Dry Index more than doubled this year as demand for raw material increased.

China Cosco surged by the 10 percent daily limit to 10.74 yuan at the close of trading in Shanghai, taking the stock to the highest since Oct. 9. Cosco Shipping Co. added 6.8 percent to 10.16 yuan. China Shipping Development Co., the nation’s biggest oil carrier, advanced 5.1 percent to 12.11 yuan.

Shipping stocks are rising as China’s steelmakers, which cut production in the second half, are benefiting from the government’s 4 trillion-yuan ($585 billion) stimulus plan in November to spark slowing economic growth. The Shanghai Composite Index has gained 21 percent this year, the world’s best performing benchmark stock gauge.

The rebound in shipping rates is “one of the indicators” that the economy is stabilizing, said Michelle Qi, a portfolio manager at Bank of Communications Schroder Fund Management, which oversees about $790 million.

The Baltic Dry Index rose for a 14th straight day, rising 9.6 percent, to 1,642 points on Feb. 6, according to the Baltic Exchange, on the expectation iron ore demand will rebound in China. That’s a 112 percent jump since the end of 2008. The index collapsed in December to levels unseen in two decades as steel demand slumped and the world economy slowed.

Iron ore is the world’s most-shipped commodity. The steel industry accounts for almost half of all dry-bulk cargo, according to shipper Golden Ocean Ltd. Stockpiles in China, the biggest user of the material, have dropped 23 percent from a high in September."


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Freight rate surge may have bearish underpinnings

The surge in a global benchmark freight index may say as much about the bearish conditions of some underlying commodity markets as it does about the bullishness of a global economy still feeling for a floor.

Talk of growing Chinese demand for Brazilian iron ore was cited as the trigger for the Baltic Exchange Dry Index's 50 percent surge last week, a rally that in turn fed optimism that the world's No. 3 economy may be bottoming out.

But freight traders, shippers and port officials say that .....

http://www.forexpros.com/news/commodities-&-futures-news/freight-rate-surge-may- have-bearish-underpinnings-27750


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The "euphoric rise" in the BDI and it's major component the BCI reversed direction in the last two days of this week. It may be that the rise was biased with an unknown number of Capesize vessels that have been taken out of service due to the very low rates.

The BCI topped out at 3822 and then retraced 487 points to 3335. A "channel" has been formed with Upper and Lower Boundaries at 4000 and 2500 . In the same time, the DSR fell $6,111 from $39,535 to $33,247. Although it has risen it is still only 34.3% of the DSR for one year ago of $114,772.

In the same time the BDI rose to 2055 only to retrace 147 points to 1908. Again it is confined, at this time, to an up-sloping channel that, at this time, has Upper and Lower Boundaries defined by 2200 and 1350 .




Next week we will see if the "hook" was set and the Indices continue to retrace to the Lower Boundaries of their respective channels or reverse again and continue upward with a "rising tide".




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Divergence

While the Global Financial Markets continued their Bear Market Rallies the Baltic Dry Index and the related sub-indices continued to act as if the "tide" was dropping.

The BCI bottomed at 830 on 12032008 while the BDI reached a Low of 663 on 12052008 . During the month of January, 2009 the Indices started rising and reports started to appear that perhaps the"corner had been turned" . Then in early February the BCI reached a 2009 High of 3822 on 02112009.. This rise and resulting false expectations was probably the results of the Chinese buying / importing " China imported 46.74 million metric tons of iron ore in February, up 43% from 32.65 million tons in January,

Since that date the BCI has fallen back below 2000 with a settlement of 1962 on 04032009.

The BDI , with influence from two other sub indices did not top out until 03102009 . However, since that date, when it reached 2298 it too has retraced 792 points to a settlement of 1506 on 04032009.

The activity of the BDI and BCi is shown in the Table below.

Baltic Dry Index

Date-------Settlement--------Change---------% Gain/Loss

05002008 ---- 11793
12052008 ----- 663 --------- -11130 ---------- -94.4
03102009 ----- 2298 ---------- +1635 ------ +246.6 *
04032009 ----- 1506 ----------- -792 ------ -48.4

===================

Baltic Capesize Index

Date------Settlement-----------Change--------% Gain/Loss

05002008 ----19580
12032008 ------830 ------------ -18750 -------- -95.8
03102009 ---- 3822 ------------- +2992 ---- +360.5 **
04032009 ---- 1506 -------------- -792 ---- -62.2

* In reality the BDI only regained 14.7% of what had been lost and with the reversal it still is 87.2% down from the all time High of 11793.

** Likewise the BCI only regained 15.9% of what had been lost and with the reversal it still is 90% down from the all time High of 19580..

It has been stated that the BDI is a leading indicator for the state of the Global Economy. I quote from a Report :

" A Rising BDI, indicates a rise in demand for Seaborne Trade, and this can be immediately translated as an increase in the volume of SeaTraded commodities/goods/etc, and mainly shows an increase in the demand for raw materials which in turn shows signs of increasing World Trade Volume and indicates World Economic Growth.".
Something must be amiss as the Global Financial Markets have been rallying the Baltic Dry Index has been falling . I have included a goodly number of charts so that one, if so wishes, can see that the Markets as well as the major miners such as BHP and RIO have all been rallying while the BDI and BCI have retraced . Perhaps just confirming that the "RALLY" is a Bear Market Rally and sooner than later a "dose of reality" will be applied to the Markets.











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G'Day Amigo,

I thought that you had uncovered the holy grail and found the leading indicator to the S&P500 in the BDI but alas, it's not so simple.

Following is a chart that shows the correlation and as you can see whilst there is a huge correlation, it's difficult to see exactly what it is because it sometimes appears to be a leading indicator and other times appears to be lagging.




"...if one tortures a dataset long enough, it will confess to anything!"

- Andrew Lo

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Rudy : I have used that site but there are no comparative charts using the sub indice BCI [ Baltic Capesize Index ] . I believe it is more indicative of the state of the Global Economy with respect to shipments [ export / imports ] of the important commodities such as iron ore , bauxite, coal, potash. If there is no sea borne transportation then all is not well .

The run up in the BCI from 830 to 3822 was the result of China importing iron ore in late January - February . I have to research and learn what carriers use the most Capesize vessels as they are the carriers of 62% of the sea borne cargoes and essentially all of the dry bulk cargoes such as iron ore . India does use some of the smaller vessels but I believe it only accounts for a small percentage of the total dry bulk shipments.

Note on the chart how the BCI and the shipping company rose and turned down in sync.



The two Market Indices are S&P 500 and the Australian S&P ASX .

The Baltic Capesize Index shows that, at this time, there is little in the way of demand for >100,000 dwt vessels. The Chinese reduced their buying so reduced demand for vessels and as a result down goes the value of the Index and along with it the share price of the shippers.

The BDI lags the BCI because it has two other components - the BPI [ Baltic Panamax ] and BSI [ Baltic Supramax ] which, if there is a demand for those sizes, can lead to a divergence between the BDI and BCI. That is what happened with BCI turning down in February while the BDI did not turn down until March.

The Global Market rallies, in my estimation, have ignored the message about the Global Economy and as a result we are experiencing BEAR MARKET RALLIES that will sooner than later arrive at the "River Styx" where perhaps reality will "surface" and the "HOPE" driven rallies will once again be in sync with the BDI and reality.

Regards,

Paddy


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World trade fall hits Hong Kong shipping


Ships travel to and from the manufacturing and trading hubs of southern China through the Lamma channel, and it is still busy.

But the ships once sitting heavily in the water, loftily loaded with containers, are now visibly higher in the water.

There is less cargo moving around the world, so less need for ships. Hence, dramatically lower rates for hiring large ships, and so a growing crisis in world shipping.

As the China boom deflates, demand for steel, iron ore and other bulk items from around the world diminishes, leaving bulk carrying ships all dressed up with nowhere to go. ....

...... "Those are bulk carriers and container ships that haven't got anywhere to go at the moment, there's no cargo for them to carry. .....

Hong Kong has about 70 ships in "hot lay-up" at the moment, meaning they are waiting with full crews. Singapore has several hundred ships in "cold lay-up", where the ships are without crew. ......

http://news.bbc.co.uk/2/hi/asia-pacific/7973752.stm


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Notes and charts from Capital Shipping:

The oversupply of tonnage and the lack of a sufficient amount of cargoes was the main cause that distanced further the BDI.




The Baltic Cape Index (BCI) made daily steady losses and the most obvious reason for this constant drop of the index is the Chinese Iron Ore demand that declined heavily.



In the global downward trend of the Dry Sector the Panamax Market was more seriously affected. There is a strong supply of tonnage in the Market.




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Shipping stocks brace for rough seas

This portion of a report by analysts from Nomura adds further confirmation that the Indices BDI and especially the BCI are leading indicators and that the Global Finacial Market rallies were stoked by "HOPE" and not "REALITY" . Also, if theybare correct in their forecast the "RECOVERY" is still a long ways off.

With the global economy still in the midst of a slowdown and inventory levels for resources rising, the marine transportation may still be awaiting the worst, say analysts.
Nomura analysts Andrew Lee and Cecilia Chan wrote in a report Tuesday that the worst was yet to come for the bulk shipping industry.
"We expect industry fundamentals to deteriorate further as demand continues to remain weak and the large order book begins to be delivered," they said. "We expect dry bulk freight rates to remain under pressure due to a combination of weak demand, high China iron ore inventory, high China steel inventory and expected delivery of new capacity." ...

The Baltic Dry Index, which measures shipping freight rates and is often considered a barometer of world trade, tumbled 1.3% to 1,466 points on 04072009. That's the benchmark's lowest level since 02042009.

Nomura's analysts said they expect the Baltic Dry Index to average 1,666 this year, down about 74% from average prices of last year, and fall a further 15% in 2010, before recovering in 2011.
"We expect dry bulk freight rates to remain under pressure due to a combination of weak demand, high China iron ore inventory, high China steel inventory and expected delivery of new capacity," they wrote. ..


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paddy
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BDI and BCI Report for Week Ending April 10, 2009

From Capital Shipping :

As mentioned earlier despite the financial market upturns, the Baltic Exchange Dry Index (BDI) lost a total of about -1.86 % or -28 points during this week. The index is down from 1,506, which was the previous closing of 3rd April, closing this past Thursday 9th April 09 at 1,478 points.



BDI has lost more than -35% in a month, reversing the rise and euphoria we saw during the previous period. It is expected that the Industry fundamentals, especially for Dry Bulk sector, will deteriorate further as demand continues to remain weak and the large order book begins to be executed. There are too many ships competing for much fewer cargoes.

A steady downturn trend characterized also the Dry Bulk sale and purchase market activity this week. Some few deals were concluded this week while the prices have been softening further. Also a greater than ever amount of uncertainty has dominated talks of all professionals within our industry, leading to a prolongation of ship buying and selling decisions.

CAPESIZE MARKET

On the contrary the Baltic Cape Index (BCI) increased, and closed with overall gains of about 3.6% or 62 points this week. The BCI closed at 2,024 points on Thursday 9th April 09, up from 1,962 which was last Friday's the 3rd of April figure.



The weak demand in metal sector remained the most obvious reason for this constant drop of the index.

Rio Tinto talks with the Chinese steel makers came to a halt this week as the offered cut of 20% was not accepted. In fact, Chinese steel Makers are asking for a 40-50% decrease in prices. Annual contract prices talks are expected to take some further long time to settle.

This Month's Capesize T/C average rate which is calculated by N. Cotzias Shipping from all T/C fixture data that are reported during the current running month, slightly increased to $17,388 during this week, from 17,229 which was last week's average.

The daily rates as seen in our separate fixtures report for Capesizes this week, ranged from $14,600 (M/V "Antonis Angelicoussis" 177.8k/07 blt/Cargill) up to $18,500 (M/V "China Steel Responibility" 175.7k/03blt /SK Shipping).


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BDI and BCI Weekly Report

The Dry Bulk Market is rebounding strongly this week with the Panamax segment leading the rebound, having gained a positive 36% in just 4 days! Easter holidays and last Monday being a Bank Holiday, left us with a short 4 day week, which was still enough to inject some of the holiday good spirit into the Dry sector.

The last disappointing macroeconomic data pushed initially lower the indicators of Wall Street, but after the second half of the week, the promising signals from Obama and Bernanke statements, gave Dow Jones a boost and we seem to have passed the 8100 point mark just before Friday's Closing. The S&P500 index, which had not closed yet at the time of publication of this report, seems to have strongly passed the 870 points mark, and moved just like the Dow J. upward steadily for the sixth consecutive week. It was of great interest to hear President Barak Obama say that "for the first time we see hopeful signs" and also to note that "the economy must be built on rock rather than sand". In similar statements, this week, Mr. Bernanke made comments about the strong foundations of the U.S. economy and the appreciation that the slow drift of economic activity is the first step we need to talk of any recovery. Mixed moves this week in Commodities Market, as the bloc's energy and metals fluctuated. Specifically Brent crude oil price moved around the $53 a barrel on the ICE Futures exchange.

The Baltic Exchange Dry Index (BDI) gained about 13.8 % or 204 points during this week. The index this week is up, from 1,478 points which was the previous closing of 9th of April. Today, Friday the 17th April 2009 it closed at 1,682 points. Although this week was just after the short Easter holidays, it seems that the minor upward momentum we had left from last week was here to give it the necessary boost. Steady daily gains of the BD index, brought some positive sentiments also in the freight rates we have seen reported during this past week.

A steady downturn trend characterized the Dry Bulk sale and purchase market activity this week. Some few deals were concluded this week while the prices have been softening further. Activity is lower than last month, and a few notable deals can be reported for this week.



CAPESIZE MARKET

The Baltic Cape Index (BCI) increased, and closed with overall gains of about 9.14% or 185 points this week. The BCI closed at 2,209 points on Friday 17th April 09, up from 2,024 which was last Thursday's the 9th of April figure. Despite the optimist sign of the Capesize market Index this week, the demand in metal sector remained weak.

Vale do Rio Doce, the Brazilian Mining Giant, has been reported this week to sell fine Iron Ore to the Chinese at spot prices, possibly in an instrumented well defined strategy to lock in a market share and therefore weakening the future contract price agreements, that are still in nego's. It seems that Vale has been clearly following a multi strategy expansion and cost reducing policy acquiring it's own capes, and having seen the plunging freight rates and the drop in Chinese domestic production because of lower iron ore prices, they saw the open "window" to step up spot sales, and make their move.

Iron ore spot prices in China, has fallen to US$64/ton mainly due to Vale's aggressive entry into the market. At the same time Chinese port stocks have risen by 10 million tons to around 68 million tons, with March iron ore imports hitting a record high of 52.1 million tons, an annualized figure up by 46%. That's the same low price level as back in October 2008, when China's steel production dropped drastically, and many Indian exporters and local Chinese producers were unwilling to sell


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China Cosco Seeks to Delay, Cancel Ships After Loss

April 23 (Bloomberg) -- China Cosco Holdings Co., the world’s largest operator of dry-bulk ships, said it’s in talks to delay or cancel orders for new vessels after slumping to a second-half loss on plunging freight rates.

“We are scaling back during the downturn,” Chairman Wei Jiafu told reporters in Hong Kong today. He didn’t say how many ships may be delayed. The shipping line is also trying to renegotiate rates on chartered-in vessels.

The company expects its dry-bulk traffic to tumble 44 percent this year as China’s cooling economy saps demand for iron ore, a steelmaking ingredient. Shipping lines have probably already canceled orders for 260 vessels worldwide, according to Lloyd’s Register, as they scale back growth back plans drawn up because rates crashed last year on the global recession.

“There is no sign of recovery yet,” said Gideon Lo, an analyst at DBS Vickers Hong Kong Ltd. “China Cosco is likely to have a loss this year.”

The Tianjin-based shipping line is also attempting to defer three of nine container vessels due this year to 2010, according to a stock exchange statement late yesterday. China Shipping Container Lines Co., the nation’s second-biggest cargo-box carrier after China Cosco, said yesterday that it expects to report a first-quarter loss as the recession saps traffic.

China Cosco rose 2.1 percent to HK$6.47 in Hong Kong today. China Shipping Container fell 3.1 percent to HK$1.90. The benchmark Hang Seng Index rose 2.3 percent.

FFA Loss

China Cosco had a 3.5 billion yuan ($512 million) second- half loss, compared with an 18.5 billion yuan profit a year earlier, based on figures in its statement.

It had a 4.1 billion yuan loss in the fourth quarter from forward freight agreements that fell in value because of the plunge in rates, according to a presentation today. FFAs are contracts used to bet on changes in shipping or chartering costs.

The shipping line also made 5.2 billion yuan of provisions for onerous contracts in the fourth quarter, it said. This covered charters that the company is locked into at above current market rates.

Annual profit fell 40 percent last year to 11.6 billion yuan, missing the 16.2 billion yuan median of 10 analyst estimates compiled by Bloomberg.

Traffic Slump

This year, the China Cosco’s dry-bulk traffic, or the total distance it carries paid-for cargo, will likely tumble to 846 billion ton-miles from 1.5 trillion ton-miles last year, according to the statement.

As of Dec. 31, the shipping line had secured 18 percent of 2009 dry-bulk operational days at rates a third lower than last year’s average. The Baltic Dry Index, a measure of commodity- freight rates, fell 92 percent last year, the biggest drop in at least two decades.

The company, controlled by China Ocean Shipping (Group) Co., had 443 dry-bulk vessels at the end of last year. It has another 58 on order.

The company’s container-shipping arm may carry 5.2 million boxes this year, compared with 5.8 million last year. It will reduce capacity on major transpacific and Asia-Europe routes during slow seasons because of waning demand. As of Dec. 31, it had a fleet of 141 container ships, with another 59 on order.

Container rates on Asia-Europe routes may rise by $300 from July 1 and by as much as $600 on transpacific lanes, Executive Vice President Sun Jiakang said


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paddy
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BHP Books 13 Capesize Vessels For China

Platts reports that BHP Billiton arranged freight for a total of 2.2 million tonnes of iron ore between Port Hedland and Qingdao in 13 Capesize ships in the space of one week. It fixed 12 ships, each to carry 170,000 million tonnes cargoes and one ship to lift a 160,000 million tonnes stem.

As per the report, BHP's move has helped drive rates higher on the route to just shy of USD 8 per tonnes compared with USD 6.45 to USD 6.90 per tonnes seen at the end of last week.

All of BHP's fixtures are for cargoes due to load in the first 12 days of May. Allowing for port congestion, brokers said that most of the ships should arrive in China by the middle of June.

The latest business reported last Friday, showed that BHP fixing a 170,000 tonnes cargo at USD 7.20 per million for a May 10 loading. It also fixed another 170,000 stem on last Friday at USD 7.95 per tonne for a May 1 loading aboard the 2009 built Marvellous on what brokers said would be the ship's maiden voyage.

On, April 17, BHP fixed four 170,000 tonnes cargoes at rates between USD 6.45 and USD 6.90.

Brokers said that ship owners were now seeking between USD 8.00 per tonne and USD 8.50 per tonne for similar business between Western Australia and China, with one owner said to be holding out for USD 9.

According toship brokers, BHP Billiton has been extremely active on the spot iron ore market this year, selling millions of tons to China on CFR terms, having previously sold almost mostly on FOB terms. Consequently it has become the most active Capesize charterer in Australasian/Asian trades so far this year.

Earlier this week, BHP Billiton said that its spot market iron ore sales at prices showing discounts to long-term contract prices, trebled to 28% of its iron ore shipments in the company's Q3 ending March 31, as Asian steel mills deferred lifting ore against long-term contracts and cut output by 50% or more.

In its quarterly production statement earlier this week, BHP said that it had received an increased number of requests for deferred deliveries from steel mills and the producer had sold the deferred material on the spot market, instead. Consequently, spot market iron ore sales in its March quarter rose to 28% of total sales compared with just 10% a year earlier.

The company said that in the first nine months of its July 1st to June 30th 2009 fiscal year, BHP Billiton produced a record 87.38 million tonnes up 6% YoY. In the Q3 it produced 28.19 million tonnes which was only 1% below the corresponding year earlier period.

The main iron ore producers and steel producers are still locked in annual contract negotiations, with some forecasters predicting a 40% reduction in iron ore contract prices over 2008. Some in the industry believe that the system of long term, fixed price contracts maybe coming to an end and that there could be a move to formula pricing based on published benchmarks.


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BDI - BCI Weekly Report

From Capital Shipping

"In our Shipping markets, The Baltic Exchange Dry Index (BDI) gained about 11.36 % or 191 points during this week. The index this week is up, from 1,682 points which was the previous closing of 17th of April. Today, Friday the 24th April 2009 it closed at 1,873 points. Our technical Analysts, advise that we are seeing the last corrective fall of a 5th downward Wave, which will most probably drop all the way below 1000 points with an estimated percentage drop exceeding -61% most likely bringing the BDI even below the 900 points mark.



Some serious statements came out of the very interesting Conference sessions: "We are only seeing the beginnings of the crisis now. That recovery we had in the last few months does not mean anything," Kenneth Koo, Group Chairman & CEO of Tai Chong Cheang Steamship Co (HK) Ltd, mentioned, while BIMCO's president-Designate Robert Lorenz-Mayer, stated: "Control-Alt-Delete is what we have to do now. We are in for a major restructuring. We have the most severe shipping cycle ever".

Klaus Nyborg, the Deputy Chief Executive Officer of Pacific Basin Shipping Ltd, stressed mainly on the impact of the huge value destruction of the dry bulk fleet. It is estimated that the value of the dry bulk fleet has dropped from $375bn to $70bn since the collapse of the Shipping/Financial markets post Oct 2008. Klaus Nyborg warned that the value of dry bulk ships could fall yet further, and unfortunately we at N. Cotzias Shipping Consultants second his emotion and share his fears.

Anyone looking for a return to the boom years that the industry has experienced over the last few years was warned that the market could well return to its more historical averages. "The industry needs a kind of reality check, the historical earnings have never been that good. This has never been a very sexy business to begin with," Mr Koo said. "It's important to keep in mind that a BDI of 1,400-1,500 points in a historical context is not that bad," Mr Nyborg said. For this year he said that it was fair to expect the BDI to trade between 1,000 and 3,000 points.

Once again the Chinese buyers remain highly active targeting bulkers (Panamax, Supra/Handy) of 80's & 90's. It is interesting to note that Chinese buyers have acquired more than 67 second hand vessels since the Start of 2009, and have spent more than 700 million USD to obtain more than 3.3 million tones of new Dry Bulk carrying capacity, expanding and surpassing the Greek buyers who traditionally had been leading the race from 2001 until today. Taking this into account we feel that China will be able in a few years, if not sooner, to carry its own products with Chinese Controlled and Owned Fleet, clearly setting the price trend according to their appetites and cost needs!!!! This could well initiate a total change of International Shipping as we all know it. Definitely we see a trend that if it continues, Greece will no longer maintain and enjoy the dominance and the large share portion of the World Shipping Trade, which we have been enjoying for decades.
============

The Baltic Cape Index (BCI) increased, and closed with overall gains of about 12.90% or 53 points this week. The BCI closed at 2,494 points on Friday 24th April 09, up from 2,077 which was last Friday's the 17th of April 09 closing figure. Chinese imports gave an optimistic sense in Capesize market Index this week; the demand in metal sector remained weak. Also if we take into consideration that the grain season is almost over from the east coast of South America and while coal imports into China are still rising, it is inevitable that that Capesize rates don't have enough upwards momentum to make it sustainable.



This Month's Capesize T/C average rate which is calculated by N. Cotzias Shipping from all T/C fixture data that are reported during the current running month increased by 16.54%, to $21.521 during this week, from $18,467 which was last week's average. The daily rates as seen in our separate fixtures report for Capesizes this week, ranged from $7,500p/d (M/V "Yong Sung" 140K/83blt/Jaldhi) up to $39,000p/d (M/V "NSS Bonanza" 170k/96blt/Rio Tinto).


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rdumas
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Hi Paddy,

Great article mate. Keep up the good work.


"...if one tortures a dataset long enough, it will confess to anything!"

- Andrew Lo

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Rudy : Here be this weeks tome:

BDI - BCI Weekly Report

[From Report by Capital Shipping]

The Baltic Exchange Dry Index (BDI) fell about -3.58% or -67 points this week, down from 1,873 on 24th of April, closing at 1,806 points on Friday the 1st of May 2009. The Dry Sector remains a highly "unstable" and "unpredicted" Market and these weekly's BDI fluctuations reflect the "uncertainty" both heavily underlying the global growth and the seaborne trade markets.

Now that the Easter Period is over, and with Labor Day holiday past us, we hope that May will be a month that will leave its mark, making the shipping markets positively get the necessary steam and steer away from troubled waters.

Thirty five countries have agreed to coordinate their export credit support efforts as part of a drive to boost international trade and investment, which should contribute to reviving the fortunes of the shipping industry. The agreement, which has been concluded as a direct response to the global economic downturn, is being supported by members of the Organisation for Economic Co-operation and Development and other export credit providers, including China, Brazil and Indonesia. It was reached at a meeting of the OECD's working party on export credits and, although the problems of the shipping industry were not discussed directly, the sector can only benefit from measures destined to boost international trade volumes. The OECD said it would be holding regular meetings in future to enable participants to exchange information and monitor progress. OECD secretary-general Angel Curria expressed satisfaction that the OECD was backing the effort recently decided by G20 nations to strengthen export credit support measures. Participants in the meeting welcomed the commitment given by the G20 nations to provide a minimum of $250bn over the next two years to support export credit and investment agencies. They said in a statement that recent declines in trade volumes were attributable to "recessionary forces and frozen financial markets" which they said had resulted in a decline in the availability of trade finance and a sharp increase in its cost. They added that the measures they had already taken, coupled with the G20 initiative, should result in an increase in the availability of export credit, especially for emerging markets and developing countries, notably through support for investment required for sustainable economic recovery.



CAPESIZE MARKET

The Baltic Cape Index (BCI) declined abt -4.73%, or -118 points this week. The BCI closed at 2,376 on Friday the 1th of May, down from to 2,494, which was last Friday's the 24th of April 09 closing figure, regardless of the Chinese imports which remained in quite satisfying levels. It was clearly evident, that Chinese import cargoes kept the Capes busy this week as many spot cargoes from the major Miners kept the ball rolling at a good pace. The Cape index if it can stabilize between the 2300-2500 points margin and it can form some resistance at these levels will keep T/C averages above $20,000 per day which can be considered as CSL (Cape Survival Levels).

According to China Steel Industry Association (CSIA) China produced 127.4 mil of tons of crude steel in 1st quarter 2009 , 1.4% up from the same period of 2008. The strong negotiations with mining giants Rio Tinto, BHP Billiton and Vale Brazil still continues as both sides failed to agree on year's long term iron ore prices. The Chinese steelmakers are seeking price cuts at region 40-50% on the annual contracts with the miners' counter offer discounts of maximum 20% in an annual basis. Stockpiles remain high and this could give us some slowdown this coming week.

This Month's Capesize T/C average rate which is calculated by N. Cotzias Shipping from all T/C fixture data that are reported during the current running month slightly increased by 0.9%, to $21.725 during this week, from $21.521 which was last week's average. The daily rates as seen in our separate fixtures report for Capesizes this week, ranged from $8,600 p/d (M/V "Venturer" 128K/81blt/Winning) up to $40,000p/d (M/V "Unique Brilliance " 176k/01blt/Kleimar).


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rdumas
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Hi Barry,

Thanks mate. Let's hope May is a ripper. We need a bullish market because I need the funds.


"...if one tortures a dataset long enough, it will confess to anything!"

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Rudy : Tide might be turning .

The BDI has, until today, been rising with the "tide" . It reached a new 2009 High of 4291 . Today there was a reversal and the Index dropped 198 to 4093.

The sub-index BCI also reached a new High for 2009. It reached the level of 8147. However today there was a reversal and the index dropped 586 to a level of 7561.

It should be noted that the :

""Key fundamental is a "Frenetic" stockpiling in China which continues to boost up the market. It is worth noting that it is likely that we will see a decline in the pace of Iron Ore imports soon, maybe to lower levels of 28mil-30mil tonnes on average per month compared with the record of 57mil tonnes of April 2009. Capes congestion hits a record high in China. The number of Capes waiting to berth has increased from 74 last week to 80, with an average waiting time of eight to nine days. ""

NOTE: Charts do not show todays drop in the BDI and BCI

BDI Daily Chart 06032009




BCI Daily Chart 06032009






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rdumas
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Hi Paddy,

You might be right there. What I find interesting is that there is not always a direct correlation between the BDI and the SPX especially since around November 2008.





"...if one tortures a dataset long enough, it will confess to anything!"

- Andrew Lo

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Rudy: Sure looks like the tide has turned. Index is at the Upper Boundary of the major channel and should drop back into it in the next settlement day.

Since 06032009 when the BDI reached 4291 [ new 2009 High ] the Index has dropped 482 points to Close at 3809 on 06052009.

Downside support levels are : 3665 - 3278 - 2652.

The BCI [ Baltic Capesize Index ] that forms part of the BDI reached a new 2009 High of 8147 on 06032009. Likewise it has dropped 1335 points to Close at 6812 on 06052009.

Downside support level : 6224


Baltic Dry Index Daily Chart 06052009




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Hi Paddy,

Just about to turn off the computer and look at some AFL games this afternoon. Before I do though I have just drawn some lines on the chart that I posted earlier which show a slightly different channel to you but suggesting a similar outcome.




"...if one tortures a dataset long enough, it will confess to anything!"

- Andrew Lo

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Rudy : Appears to me that your channel is drawn on the SPX data.

Here is a more detailed chart with my geometric configurations .

The inner wedge boundaries [ red ], at this time, coincide with Fibonacci levels . Likewise the lower boundary [ lilac ] of the major channel coincides with a Fibonacci level.

The interpretation seems reasonable to me but then one never knows the effect of an oxygen deficiency.

Have one for me.

Adios

Paddy


BDI Daily Chart - 06072009 - Revised Interpretation






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rdumas
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Dooh!!!

I'd like to say that I was only kidding but in fact it was my advanced stage of dementia that caused me to draw the channel on the wrong index.



Sorry about that.


"...if one tortures a dataset long enough, it will confess to anything!"

- Andrew Lo

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Hi Paddy,

Having a look at your chart, it appears that the BDI has made a 3 wave correction at this stage. If that is the top of the correction then it means we have ourselves a potential Flat pattern which would call for a minimum retracement of 70% of the up range.

IF this turns out to be the case then I can only hope that the SPX doesn't follow the BDI. Gann Global Financial believe that we are about to be hit by a large correction in commodities and equities which will take back much of the rally that started in March.

(Message edited by rdumas on June 08, 2009)


"...if one tortures a dataset long enough, it will confess to anything!"

- Andrew Lo

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Rudy : By your time the sun was over the yardarm so I chalked it up to that you had an early start on "victory" celebrations. That is why I told you to have one for me. Now a no-no for me.

Back to more mundane issues: If I understand correctly your retracement of 70% of the rise from 663 - 4291 would be :

[4291]-[663]= 3268

[4291] x [0.7] = 2003

That is close enough to the lower boundary of the great channel.

The BDI rally was in some ways, to my thinking, artificially induced by the Chinese stockpiling raw resources . The acquiring of resources was not dictated by demand from the primary users of the raw materials. It probably was part of the game been played by the Chinese government in the guise of Chinese companies.

They are probably really annoyed to say the least at BHP and RIO for their "hail mary" that saw them lose the RIO game. I hope they are good and p--sed off. Nice to see them on the losing end . Now your polis have to wake up and stop the tying up of the iron ore etc, by acquisition deals with the juniors.

Adios,

Paddy


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paddy
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Rudy : In the first two days of this week the Index has continued to drop. Today the Settlement was 3518 . This is not shown on chart as not updated but the horizontal line at 3518 shows the level. It also coincides with a support level at 3517 .

Next Support level is now at 3278.

In 4 sessions the BDI has retraced 23.7% of the recent "rally".

The sub-index BCI has also continued its retracement and now has gone from 8147 to 6382 in four sessions. That is 24.1% of the recent "rally".

Regards,

Paddy

BDI Daily Chart 06092009




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rdumas
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Hi Paddy,

I have to admit that the 3278 level looks like the likely next stop. I feel that the SPX will peak tonight (possibly a reasonable thrust up) before starting its downward journey. If not then I will have egg on my face.


"...if one tortures a dataset long enough, it will confess to anything!"

- Andrew Lo

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paddy
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$BDI carrying out "evasive action" like a cargo ship in sub infested waters.

From the 2009 High the GSS $BDI steered a course 160° to 3452 North [ Fibonacci level 3453 ] where it swung sharply to a new heading of 030° and when it reached 4073 North [ Fibonacci level 4074 ] it again reversed direction. Insufficient data to determine new heading at this time but appears to once again be setting a southerly course.


Baltic Dry Index Daily Chart 06192009

Course of the GSS $BDI




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paddy
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Since last update the GSS $BDI has continued on a southwesterly course heading for 3278. With the Closes today of 3375 it is only 5 points short of sub Fibonacci level 3370.

Pattern wise I see a "Flag" forming within a blue "Triangle" that has formed within the major ascending red "Channel".

A break below 3278 should set up a test of the lower boundary of the "Channel" which sits at approximately 2650.

In conjunction, the BCI [Baltic Capesize sub-index] has fallen from 7996 to 6104. Now down 2043 points from the 2009 High of 8147.

Looks like that "thriving" global economy has hit a slippery slope and progress has been impeded. Like China has slowed down the stockpiling of natural resources - iron ore and coal.

$BDI Daily Chart - 7062009




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paddy
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$BDI

Since the last posting the Index has continued on dropping towards the Lower Boundary of the ascending Channel that started to form in January of this year.

The Index has now dropped 1306 units from the 2009 High of 4291 to a Settlement of 2985 on July 10th.

This coming week should see 2891 tested and then the Lower Boundary of the Channel.

The sub Index BCI, in the same time period, has fallen from a High of 8147 to 4844. Based on this it would seem that the Global Economy is still dormant as the Capesize vessels of this sub Index are experiencing a reduced demand for their services of transporting iron ore and coal.


$BDI Daily Chart - 7102009




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paddy
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Tide is Falling and so is the Index

Telegraph: Shipping flashes early warning signals again
“Port statistics are revealing. They were a leading indicator before the production collapse in the Japan, Europe, and the US over the winter, and they may be telling us something again.

“Amrita Sen at Barclays Capital says the number of Baltic Dry ships waiting to berth - mostly in China and Australia - has begun to fall after peaking at 154 in mid-June.

“The Capesize Iron Ore Port Congestion Index is replicating the pattern seen a year ago just before the commodity boom tipped over.

“‘The anecdotal evidence we are hearing is that vessel queues have been falling. There are reports of cancelled tonnage from China pointing to a slowdown in Chinese buying of coal and iron ore.

“‘We are definitely expecting a correction. People have been building stocks of iron ore too quickly in anticipation of the stimulus package in China,’ she said.

“The Baltic Dry Index measuring freight rates jumped 450% in the first half of the year on the China rebound, but has begun to fall back over the last two weeks. (Sen doubts freight rates will recover much since 1000 new ships are hitting the market this year and again next year, compared to 300 in normal years. There is obviously a horrendous shipping glut).”

Source: Ambrose Evans-Pritchard, Telegraph


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eblode
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Paddy,
Perhaps you know the answer.
Why is DWS, which has a great business, has no debt and is paying 12% dividends not flying off .72 cents per share.? I've got the shares and it beats me that it isn't flying higher. Just curious.

Eugenio


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paddy
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BDI / BCI


From Capital Shipping

The Dry Bulk Market during the past five weeks has been going up and down on a saw tooth shaped pattern. As discussed before, shipping investors are presently in a fog, waiting for something to either confirm their greatest hopes that the economic recovery is indeed unfolding, or their greatest fears that the improving markets and economic conditions of the past four months have been nothing but a mirage. Right now it appears that the hopes and fears are about equally balanced.

The Baltic dry index (BDI) closed on Friday the10th of July 2009, with severe losses of approximately -15.2% dropping -535 points during this current week. The Baltic Dry Index continued from where it left last week, and dropped for five consecutive days during this week to close at 2,985 points. The BDI was down from 3,520 which was the previous closing of Friday's the 03rd of July.

Chinese Buyers continue to buy secondhand vessels while Greek buyers have tried to narrow the gap. As we had stated in our Monthly report for June 2009, for the first half of 2009, Chinese buyers have surpassed Greek buyers in terms of units acquired. Chinese have bought 115 dry cargo units and Greeks 98. If we add to these the Tanker vessels then, yes we can say that Greeks may well be enjoying number one seat� but it's the Bulkers that we are mostly concerned as we have seen that Chinese may well have re-entered into the market, at least for domestic transportation dry cargo units that were sold and should have been destined for scrap. It is worth reporting to you that a handful of "scrapped" ships that we can recall have been renamed and belong to Chinese shipping companies� maybe this is another form of ship "recycling"..///..

The Baltic Cape Index (BCI) in total decreased about -24.7% or -1594 points during this week. The BCI moved sharply downhill, and closed at 4,844 on Friday 10th July 2009, down from 6,438, which was last Friday's the 03rd of July closing figure.

China's demand for Iron Ore has experienced what we had mentioned last week, a slow-down in Iron Ore movements as most cargoes that had moved were part of speculative buying by traders who cooling off their appetites especially now during the summer period.


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paddy
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Baltic Dry Index

While the Markets kept rising the $BDI reversed course and once again set a course for the Lower Boundaries of the major ascending channel. Since topping out at 4291 the Index has been meandering down to the lower boundary while remaining confined to a small cross-cutting descending channel. Expect a test of boundaries this coming week.

$BDI - Daily Chart - 7242009




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paddy
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BDI

The BDI does not appear to be forecasting a vibrant global economy is in the offing. It has continued correcting on an ESE course heading for a test of 3250. On the other hand it may be foretelling what will take place after this Bear Market Rally tops out.

$BDI Daily Chart 7312009





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paddy
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The $BDI continued on its course to test the Lower Boundary at 2532.

As mentioned before, a declining Index means that there is no demand for cargo ships and more importantly Capesize vessels that are used to transport iron ore, coal and bauxite. No buying of these commodities means that there is minimal selling of manufactured products which translates to a non thriving global economy.

$BDI Daily Chart 8072009




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paddy
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Since last reported on the $BDI has continued its sinuous retracement . It has broken below the Lower Boundary of the Channel that was started last December. This would have taken place in late April if the chinese hadn't created an artificial "stockpile" rally that resulted from an increased demand for Capesize vessels. That came to an end in June and since then the Index has been reflecting the true global economy .

In the USA soon will be able to start second rendition of " 99 Banks on the wall". With over 400 on the "endangered" list we may get four rousing versions of the song.

The next support level is at 2339 which was almost tested on August 25th. After that the major support levels are 2146 and 1952.


$BDI Daily Chart 8282009





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paddy
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As of 9022009 the BDI is back on track @ 2413 . Heading to test 2339 . By my number it is a very critical level because if it fails then the target becomes 2145.

Article from Net:


................""OSK Investment Bank analyst Ng Sem Guan said China were over-stocking its iron ore requirement, leading to the huge imports of the raw material.

“The imports of iron ore in the last couple of months averaged 70% of the country’s needs, based on assumption of 63% iron content. In comparison, imports of iron ore averaged over 50% in 2007 and 2008,” he told StarBiz in a telephone interview.

The impact of dry bulk rates on company’s earnings usually lagged by a month, Ng said, adding that third quarter results should still be buoyant for companies but the outlook for the fourth quarter remained uncertain.

Liong said the recovery in dry bulk rates would depend on the global economic recovery as well as the supply of vessels in the market.

“Supply of new vessels is still in excess to demand. Higher scrapping is needed and cancellations of more vessels are required to balance the slowing demand,” he added.

An analyst with a local brokerage, meanwhile, said the Chinese government was likely to monitor closely the imports of iron ore after warning from the China Iron and Steel Association that steelmakers were blindly rushing back to full production and risked flooding the market with unwanted steel."""" ...........

http://biz.thestar.com.my/news/story.asp?file=/2009/9/2/business/4630652&sec=bus iness


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paddy
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Hi Rudy : I have updated the report and the chart. Still the same story.

The Index is getting close to a reversal point. A natural on is at the 0.382 Fibonacci value of 4914.66.

The settlement on 191109 was 4661 with a rise of 18 points. However the BCI dropped 187 points to 8056. On the 20th the BCI continued its downward reversal with a settlement at 7542 on a drop of 514 points. As expected the BDI, heavily weighted by the BCI, turned down shedding 154 points for a settlement of 4507. Once this correction is completed there will be a leg 5 that will rise towards the 50% retracement level.


As I see the Weekly chart:

11793 - 663 EW the letter A

663 - 4291 EW B(A) 3628 points

4291 - 2163 EW B(B)

2163 - ? EW B(C) Believe that 3 is completed and started on 4 of 5 . If A=C then target 5791 - reasonable and still short of 50% retracement from the HIGH of 11793.

For a dose of reality consider that one year ago a Capesize vessel could be chartered at a daily rate of $USD 3691 . Today it is $USD 81575 but way below High of $USD 233,000 that was set in 2008.

Thoughts From The Other Side

They say this is an Index that can not be manipulated. I think it could be . All you need is a country with a surplus of $US . On a low you have "traders" invest heavily in shipping companies. You could also do the same with resource companies but the reward might be much greater with the dry bulk shipping companies. Then you issue a directive " build up those stockpiles of iron ore and coal" . Capesize vessels will be in great demand resulting in an increasing daily rate which sends up the BCI and also the BDI. This also results in additional cash flow for shipping companies and UP go the share prices. So they change gringo money for real assets and when ready they can reverse the process by reducing imports and shorting the shipping companies.


Baltic Dry Index Weekly Chart 201109




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rdumas
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Hi Paddy,

The other interesting relationship is the one between the BDI and copper.




I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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gdd3
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Hi Rudy(et all)...

I had noted that the Baltic Dry Index was once again "re-visting" its GFC lows(humm...confirming the terrible outlook for The Flying Kangaroo Country) and came up with this old thread, and more particularly, your last post...
The BADI verses Copper hinting at the relationship between the both.

So, I continued that theme going forward to create this chart that clearly shows that the BADI/Copper relationship changed just 6 months later(than your posting)...June,2010. From that time, BADI has broken down badly; now re-visiting its GFC lows and ofcourse never got within "cooeee" of its over-inflated pre-GFC highs whereas the P.O.Copper recovered its pre-GFC highs and some and held on to its uptrend(from the GFC lows) for another 13 months after the BADI broke down. Sure, the P.O.Copper is once again looking wobbly but it is still holding its 38.2% retracement level off the GFC low.

A question arises here is whether we should be looking at the price of Iron-Ore and see whether that now has taken precedence over the P.O.Copper as the big "weighted" commodity for the BADI? So, can anyone produce a chart comparison between the BADI and Iron-Ore prices?.

Anyway, here is my chart of BADI verses P.O.Copper...

}}



Cheers and have a good weekend all.

Dolphin}


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rdumas
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Hi Dolphin,

Sorry that I can't help with the Iron Ore/BDI comparison. The closest thing that I can get to that is the CRB/BDI price comparison.






The views expressed in this post are purely mine and may not necessarily line up with reality - Rudy

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gdd3
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Thanks Rudy for your comparison chart...it only confirms what I suggested above and that was "...as of about June 2010, the BADI(our accepted L/T "leading" indicator, right!), hasn't been showing a rosy future for "shipping-dirt" from our Aussie economy". I note that the CRB also took out the pre-GFC highs before starting to play 'catch-up' with the BADI. I also note we have seen a 'bounce' recently in the CRB versus BADI direction....most likely due to the re-newed enthusiasm in precious metals, aye.

Still trying to locate a reasonable P.O. Iron-Ore chart over the same period but as yet unsuccessful. I did, however, find a very interesting and informative link ...

http://www.thesteelindex.com/files/custom/Iron%20Ore/TSI%20Iron%20Ore%20Referenc e%20Prices%20-%206%20Jul%2012.pdf

from the website ... http://www.thesteelindex.com/en/iron-ore/...that you may want to look at.


Cheers
dolphin

(Message edited by gdd3 on August 25, 2012)

(Message edited by gdd3 on August 25, 2012)


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mads
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Hi Dolphin,

Thanks for bringing the BADI information to my attention. I have been away from this forum for a while.

You are right of course, it has not been that rosy for shipping dirt from OZ for quite a while and it is just going to get that much harder with the softening of the Chinese economy.

Where are we heading? I guess things won't improve unless Europe sorts itself out. There might be new developments in Europe in the next couple of days - printing money (buying bonds) might be on the books, to keep (maybe start) the wheels turning in Europe. China relies on Europe and we rely on the Chinese.

mads


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ingot54
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"The Baltic Dry Index is no longer the reliable indicator of sea trade it once was" asserts this article.

The massive growth of the Chinese export trade in steel means that ever-larger and larger bulk carriers have needed to be built to accommodate the demand for the raw material - iron ore.

This growth has meant that "iron ore represents over 29% of dry bulk cargo worldwide" and it takes little imagination to see how that weighting affects the BDI.

Read more here: https://wolfstreet.com/2018/07/28/the-largest-ships-in-the-huge-iron-ore-trade/







Keep Smiling - Don't look back

Hell, there are no rules here - we're trying to accomplish something ~ Thomas A. Edison

Never believe that a few caring people can't change the world. For, indeed, that's all who ever have ~ Margaret Mead


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ingot54
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Current BDI is not pretty:

https://tradingeconomics.com/commodity/baltic

One wonders why we continue these boom/bust cycles when neither are in anyone's best interests (ie traders, regimes, economies).

Complicating the boom/bust is the tariff wars.
Short-sightedness in both leadership and markets seems to doom us to continue this sad state of affairs.


Keep Smiling - Don't look back

Hell, there are no rules here - we're trying to accomplish something ~ Thomas A. Edison

Never believe that a few caring people can't change the world. For, indeed, that's all who ever have ~ Margaret Mead

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