Commodity Shipping Has Worst Streak in Five Years on Surplus
June 30, 2010, 11:59 AM EDT
By Alistair Holloway and Alaric Nightingale
June 30 (Bloomberg) -- Commodity shipping costs measured by the Baltic Dry Index extended their longest losing streak in almost five years as an expanding fleet overwhelmed weakening demand for grain, coal and ore carriers.
Imports of coal and iron ore by China, the world’s biggest user of the commodities, fell for two consecutive months, customs data show. Grain shipments from South America slowed, leaving shipping lines with “the full force of vessel supply,” Martin Sommerseth Jaer and Erik Nikolai Stavseth, Oslo-based analysts with Arctic Securities ASA, said in a report.
The index fell 41 points, or 1.7 percent, to 2,406 points, the lowest since October 2009, according to the Baltic Exchange in London. That’s the 24th consecutive drop, the longest losing streak since August 2005. Daily rates for capesize ships, typically iron ore transporters that are three times the size of the Statue of Liberty, slumped 59 percent since reaching a 2010 high on June 2. more