World News
Baltic Dry Index Drops Below 600
The Baltic Dry Index (BDI) was down 22 points Tuesday to 594, the lowest it has been since April 13 when it sat at 567.
Average spot TC rates were down across all major segments Tuesday, as Capesize earnings slid $667 to $5,946 per day, Panamax lost $24 to fall to $4,646 per day, and Supramax declined by $84 to $5,926 per day.
The BDI has now fallen every day since hitting 715 on April 27, but is still some away from February's bottom of 290.
Rahul Kapoor, director of Drewry Maritime Equity Research (Drewry), is one of those who appears unconcerned over the recent slump, and speaking at the Capital Link China Shipping Forum in Shanghai on Tuesday, said now is the time to pursue second hand buys within dry bulk, and patience would be turned into reward, TradeWinds reports.
Kapoor notes that Drewry's secondhand dry bulk price index decreased by 38.4 percent since January 2015.
"Investors who want to defensively play the dry bulk market can look to invest in physical assets as they would offer more certain and gradual return compared to stocks," said Kapoor.
As a result of the market's depressed prices, Kapoor says models show that a five-year panamax investment will result in an internal rate of return of 16 percent by 2020, and a Capesize investment right now would bring a 12 percent rate of return by 2020.
After falling to a new record low of 290 in February, the BDI appeared to have been making gains toward recovery up until April 27 when this trend began to reverse.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 510.00 | 2.50 | 611.00 | 4.00 |
| Rotterdam | 477.00 | 1.00 | 618.50 | 4.00 |
| Houston | 469.50 | 0.50 | 610.00 | 2.00 |
| Fujairah | 501.50 | 1.50 | 708.50 | 3.50 |
| Global 20 Ports Average | 532.00 | 2.00 | 711.50 | 0.00 |
| Global 4 Ports Average | 489.50 | 0.50 | 637.00 | 0.50 |
| Global Average Bunker Price | 571.00 | 1.00 | 759.00 | 0.50 |
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