By C. S. TAN
PETALING JAYA: The Baltic Dry Index (BDI) crossed the psychological 8,000-point level, closing at a new high of 8,090 on Wednesday.
With the latest surge in the index, the BDI, which measures commodity shipping costs of various routes and ship sizes, has averaged 6,950 so far in the current quarter, 16% higher than the average 5,983 in the second quarter this year.
The average in the current quarter is 93% higher than the average 3,593 in the corresponding quarter last year.
A Bloomberg report quoted China Cosco Holdings Co chairman Wei Jiafu as saying yesterday that shipping rates for dry-bulk cargo, such as iron ore and coal, would continue to rise as China's economy would see robust growth for the next 20 years.
In another report, Bloomberg quoted China Ocean Shipping (Group) Co deputy director of research and development Yang Shicheng as saying that China would import 390 million tonnes of iron ore this year, 11% more than last year.
That would hold freight rates at record highs, he said, adding that iron ore would remain the key driver of freight rates, having replaced grain since the start of the century.
AmResearch said in an update report yesterday that dry-bulk charter rates set all-time highs again last week, with average Capesize spot charter rates ending the week at close to US$125,000 a day, while the average Panamax spot charter rates finished at over US$62,000 a day.
Capesize refers to ships that are too large to pass through the Suez Canal and Panama Canal, and which have to go around the Cape of Good Hope or Cape Horn. Panamax refers to ships that are too big to go through Panama Canal.
AmResearch cited a media report that an aluminium smelter would be put up in Sarawak by a joint venture between Rio Tinto and Cahya Mata Sarawak Bhd.
“We view this news as positive to our bulk universe, both for the long haul (Maybulk) and feeder services (Hubline).
“Hubline will have first mover advantage due to its stronghold in resource-rich Sarawak, and with the expected delivery of two handysize vessels by 2009, Hubline will be running a total of 26 bulk vessels,” AmResearch said.
Handysize is the most widely used type of dry-bulk vessel and are between 15,000 and 50,000 tonnes deadweight in size.
