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The plunge in the Baltic Dry Index says more about overcapacity in the tanker industry than the...

The plunge in the Baltic Dry Index says more about overcapacity in the tanker industry than the direction of the world economy. A JP Morgan analyst sees demand for space growing at a healthy 8.1% this year, but capacity growing even faster. BALT -0.5%. DSX +0.7%. SEA +0.04%.
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  • Herr Hansa
    , contributor
    Comments (3080) | Send Message
     
    Tankers - oil - wet. What do they people not understand about the Baltic "DRY" Index? You want to watch tanker spot rates, then look at the Baltic Clean Tanker Index and Baltic Dirty Tanker Index.

     

    navigatemag.ru/indices/

     

    These do not simply match the Dry Index. Also, larger tanker companies often have much of their fleets on chartered longer term rates, meaning that spot rates are not a factor for those companies.

     

    Several of the ship brokers publish weekly reports that are vastly more informative than watching a graph that only charts a handful of companies. There is also what I feel is a better index for tankers:

     

    www.riverlake.ch/reti....

     

    Cargo and dry bulk shipping are still at a large over-capacity. There was also a recent failure of a large Korean shipping company, which does affect numerous other companies. Find the news sources, investigate companies individually, and then make more informed decisions.

     

    Disclosure: long Frontline (FRO), General Maritime (GMR), and Torm (TRMD)
    3 Feb 2011, 11:19 PM Reply Like
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