As reasoned in my previous article, the drybulk fundamentals remain healthy; in the following months, we witnessed a 100% increase in the drybulk rates. After hitting a new record high late in May, with BDI at an amazing 11,793 points, the market was steady for two weeks before dropping heavy in the latter half of June. In just a matter of days the the BDI plunged about 15%, once again terrifying the stock market. Since the end of June the drybulk rates have been increasing after BDI hit a low of 9,139, wich represented a 22.5% drop in only 5 weeks. The January drop was thought by some to be a one-off, but in this highly volatile business nothing but the extraordinary is to be expected. This is drybulk shipping; volatility alert!

What happened this time?

The recent slide in stock prices have left many investors worried about the real strength in the drivers behind the latest year's surge in drybulk rates. In the following article we will look behind the daily stock movements, trying to explain the long-term fundamentals of the drybulk business.

Of the total seaborne trade, drybulk sums up to 36% (2,800 million tons), making it the second largest after the liquid bulk cargoes (38%). The major drybulks consisting of commodities such as iron ore, steam coal and grain.