Baltic Dry Index

Hanjin Shipping To Shut Down EU Operations As Global Demand Falls

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H/t reader squodgy:

“As predicted.”

– Hanjin Shipping To Shut Down EU Operations As Global Demand Falls:

Remember all those mainstream pundits and the lie-mongers at Forbes that claimed the collapse of the Baltic Dry Index was due to an “oversupply of ships” and not falling global demand?  Well, they seem to have disappeared recently as shipping agencies like Maersk Lines have openly admitted that falling demand around the world for raw materials and oil have resulted in dismal shipping rates.  The latest nail in the coffin of the mainstream fantasy has been the implosion of Hanjin Shipping, a massive shipping conglomerate that is now essentially bankrupt, and this has been due to FALLING DEMAND in a dwindling marketplace, not too many cargo ships active on the seas.  It might take longer than expected, but almost every single argument made by the alternative financial media over the years is being proven correct…

Hanjin Shipping Co., South Korea’s largest container line that has put its Asia-U.S. business on sale after filing for bankruptcy protection late August, won approval from a court to wind down its European operations as demand for its services to the continent slumped.

Read moreHanjin Shipping To Shut Down EU Operations As Global Demand Falls

Global Supply Chains Paralyzed After World’s 7th Largest Container Shipper Files Bankruptcy, Assets Frozen

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– Global Supply Chains Paralyzed After World’s 7th Largest Container Shipper Files Bankruptcy, Assets Frozen:

After years of relentless decline in the Baltic Dry index today the largest casualty finally emerged on Wednesday when South Korea’s Hanjin Shipping, the country’s largest shipping firm and the world’s seventh-biggest container carrier, filed for court receivership on Wednesday after losing the support of its banks, leaving its assets frozen as ports from China to Spain denied access to its vessels.

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Surprise! Baltic Dry Index Plunges Most Since November As Commodity Bubble Bursts

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– Surprise! Baltic Dry Index Plunges Most Since November As Commodity Bubble Bursts:

Who could have seen this coming? Remember a week ago when TV entertainers crowed about the surge in The Baltic Dry Freight Index was a “clear signal” that ‘China is back’ baby and that escape velocity growth was just around the corner as global growth was destined to pick up…

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Well, just as we warned very explicitly, the ramp in the index merely reflected the frenzied speculation in industrial metals by the Chinese and as authorities have cracked down on that idiocy, so the Baltic Dry has plunged by the most since November… as real demand punches back.

Read moreSurprise! Baltic Dry Index Plunges Most Since November As Commodity Bubble Bursts

It’s Now Cheaper To ‘Buy’ A Dry Bulk Freight Tanker Than A Starbucks Coffee

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From the article:

Goldenport, one of the last shipping companies left on the London Stock Exchange, has delisted from the market and sold off six of its remaining eight vessels for $1…

…”average daily hire rates have fallen below even a vessel’s daily operating expenses.”

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– It’s Now Cheaper To ‘Buy’ A Dry Bulk Freight Tanker Than A Starbucks Coffee:

Just 3 short months ago, we detailed how – thanks to the collapse in China’s growth and massive commodity inventory gluts, the cost of renting a Dry Bulk Tanker was less than the cost of renting a ferrari for a day…

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As Bloomberg reported at the time,

Rates for Capesize-class ships plummeted 92 percent since August to $1,563 a day amid slowing growth in China. That’s less than a third of the daily rate of 3,950 pounds ($5,597) to rent a Ferrari F40, the price of which has also fallen slightly in the past few years, according to Nick Hardwick, founder of supercarexperiences.com.

Read moreIt’s Now Cheaper To ‘Buy’ A Dry Bulk Freight Tanker Than A Starbucks Coffee

World’s Biggest Containership “Hard Aground” As Baltic Dry Crashes Below 300 For First Time Ever

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– World’s Biggest Containership “Hard Aground” As Baltic Dry Crashes Below 300 For First Time Ever:

Before this year the lowest level The Baltic Dry Index had reached was 556 in August of 1986 and the highest was in June 2008 at a stunning 11,612. Today saw the freight index hit a new milestone however, crashing through the 300 barrier for the first time ever – at 298, this is almost 50% below the previous record low.

Baltic Dry Index Record Low

Commodities obviously are saying something very different from “the market”…

Read moreWorld’s Biggest Containership “Hard Aground” As Baltic Dry Crashes Below 300 For First Time Ever

‘Zombie Ships’ – Why Global Shipping Is Even Worse Than The Baltic Dry Index Suggests

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– “Zombie Ships” – Why Global Shipping Is Even Worse Than The Baltic Dry Suggests:

One glance at The Baltic Dry Index’s collapse is all that most need to see the painful state of the global shipping industry. However, as gCaptain reports, reality is even worse as the boom in so-called “zombie ships” suggests there is no recovery in sight for the beleaguered containership charter market, which is facing its biggest crisis since the 2008 financial crash.

It looks bad…

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And it’s not just over-supply… (trade is slowing rapidly)…World trade volume rose by only 0.5% YoY in October and was up 2.4% YoY in the first 10 months of 2015, while world trade value in USdollar terms declined by 12.2% YoY in October and was down 11.8% YoY in the first 10 months of 2015.

World Trade Volume Collapse

But, as gCaptain details, reality is even worse for the world’s shipping industry…

Analysts agree there is no recovery in sight for the beleaguered containership charter market, which is facing its biggest crisis since the 2008 financial crash.

However, unlike that bleak period for shipping, which ultimately resulted in a strong recovery for charter rates, this time the fundamentals are quite different.

Read more‘Zombie Ships’ – Why Global Shipping Is Even Worse Than The Baltic Dry Index Suggests

Baltic Dry Crashes Under 400 – US Freight Volumes Fall For First Time In 3 Years

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– US Freight Volumes Fall For First Time In 3 Years As Baltic Dry Crashes Under 400:

For the first time in three years and before that the recession, the total volume of freight moved by road, rail, pipeline, inland waterways and air has fallen Y/Y. Meanwhile, on the high seas, the Baltic Dry has collapsed under 400. 

 

Food and Medicine Will Soon Be Unobtainable

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H/t reader squodgy:

“Like I said, if the BDI has effectively stopped, and all transatlantic freighters are held up in port, commodities, food, oil, general cargo is at a standstill, but we still need feeding, warming, healing & the ability to travel.”

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– Food and Medicine Will Soon Be Unobtainable:

If product is not moving, then how will you get your food, medicine and other essential supplies? Famed economists, John Williams, from Shadow Stats and Joseph Meyer, Straight Money Analysis, will tell you that the Baltic Dry Index is the best indicator of the economic health of the economy.

The BDI Is At a Record Low

Unfortunately, the BDI, has just dropped another 3.1% to a new record low of 402. To anyone who knows anything about economics, it is clear that the end of this financial era is quickly coming to an end.

Read moreFood and Medicine Will Soon Be Unobtainable

Baltic Dry Index Falls Further

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– Baltic Dry Index Falls Further:

The Baltic Exchange’s main sea freight index tracking rates for ships carrying dry bulk commodities fell on Friday reflecting low vessel demand across nearly all vessel sizes.

The overall index, which gauges the cost of shipping cargoes including iron ore, cement, grain, coal and fertiliser, slipped 12 points, or 2.25 percent, to 522 points.

The Baltic index is seen by investors as an indicator of global industrial activity.

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Global Trade Just Snapped: Container Freight Rates Plummet 70% In 3 Weeks

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cargo ship keeling

– Global Trade Just Snapped: Container Freight Rates Plummet 70% In 3 Weeks:

Spot rates for transporting containers from Asia to Northern Europe have crashed a stunning 70% in the last 3 weeks alone. This almost unprecedented divergence from seasonality has only occurred at this scale once before 2008! 

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The Baltic Dry Shipping Index Just Collapsed To An All-Time Record Low

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– The Baltic Dry Shipping Index Just Collapsed To An All-Time Record Low:

I was absolutely stunned to learn that the Baltic Dry Shipping Index had plummeted to a new all-time record low of 504 at one point on Thursday.  I have written a number of articles lately about the dramatic slowdown in global trade, but I didn’t realize that things had gotten quite this bad already.  Not even during the darkest moments of the last financial crisis did the Baltic Dry Shipping Index drop this low.  Something doesn’t seem to be adding up, because the mainstream media keeps telling us that the global economy is doing just fine.  In fact, the Federal Reserve is so confident in our “economic recovery” that they are getting ready to raise interest rates.  Of course the truth is that there is no “economic recovery” on the horizon.  In fact, as I wrote about yesterday, there are signs all around us that are indicating that we are heading directly into another major economic crisis.  This staggering decline of the Baltic Dry Shipping Index is just another confirmation of what is directly ahead of us.

Read moreThe Baltic Dry Shipping Index Just Collapsed To An All-Time Record Low

Baltic Dry Index Crashes Near Record Low … For This Time Of The Year, It Has NEVER Been Lower …

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– Baltic Dry Index Crashes Near Record Low:

The Baltic Dry Index staged a recovery mid-year, hopefully rising amid promises of stability in China and an ‘escape’ velocity USA. All that centrally-planned hope and hype faith has been eviscerated on the altar of economic reality. With no ability to directly manipulate the Baltic Dry Index to ‘pretend’ everything is awesome, it remains among the best ‘real’ indicators of the state of the global economy… and it’s in the toilet…

From hope to nope…

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The Batlc Dry nears all-time record lows once again…

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In fact, for this time of year, it has never been lower…

Read moreBaltic Dry Index Crashes Near Record Low … For This Time Of The Year, It Has NEVER Been Lower …

It’s Official: The Baltic Dry Index Has Crashed To Its Lowest November Level In History

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– It’s Official: The Baltic Dry Index Has Crashed To Its Lowest November Level In History:

2015 has been an ‘odd’ year. Typically this time of year sees demand picking up amid holiday inventory stacking and measures of global trade such as The Baltic Dry Index rise from mid-summer to Thanksgiving. This year, it has not.

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In fact, it has plummeted as the world’s economic engines slow and reality under the covers of global stock markets suggests a massive deflationary wave (following a massive mal-investment boom). At a level of 631, this is the lowest cost for Baltic Dry Freight Index for this time of year in history.. and within a small drop of an all-time historical low.

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Hard to ignore something that has never happened before as anything but a total disaster for world trade and economic growth.

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As we concluded previously after exposing the collapse in Ships…

Read moreIt’s Official: The Baltic Dry Index Has Crashed To Its Lowest November Level In History

Baltic Dry ‘Bounce’ Is Dead – Freight Index Lowest In 29 Years For Time Of Year

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– Baltic Dry ‘Bounce’ Is Dead – Freight Index Lowest In 29 Years For Time Of Year:

Since the mid-July peak, when Jim Cramer warned the market’s “last shred of hope was the freight index holding up,” The Baltic Dry Index has been in free fall (at a time with very positive technicals). In fact, today’s drop to 809 is the lowest in over 3 months and the lowest for this time of year since 1986!!

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Something Just Snapped: Container Freight Rates From Asia To Europe Crash 23% In One Week

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– Something Just Snapped: Container Freight Rates From Asia To Europe Crash 23% In One Week (ZeroHedge, Aug 2, 2015):

One of the few silver linings surrounding the hard-landing Chinese economy in recent weeks has been the surprising resilience and strength of the Baltic Dry Index: even as Chinese commodity demand has cratered in 2015, this “index” has more than doubled in the past few months from all time lows, and at last check was hovering just over 1,100.

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Many were wondering how it was possible that with accelerating deterioration across all Chinese asset classes, not to mention the bursting of various asset bubbles, could global shippers demand increasingly higher freight rates, an indication of either a tight transportation market or a jump in commodity demand, neither of which seemed credible.

We may have the answer.

Read moreSomething Just Snapped: Container Freight Rates From Asia To Europe Crash 23% In One Week

One Last Look At The Real Economy Before It Implodes – Part 1

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– One Last Look At The Real Economy Before It Implodes – Part 1 (ALT-MARKET, March 4, 2015):

We are only two months into 2015, and it has already proven to be the most volatile year for the economic environment since 2008-2009. We have seen oil markets collapsing by about 50 percent in the span of a few months (just as the Federal Reserve announced the end of QE3, indicating fiat money was used to hide falling demand), the Baltic Dry Index losing 30 percent since the beginning of the year, the Swiss currency surprise, the Greeks threatening EU exit (and now Greek citizens threatening violent protests with the new four-month can-kicking deal), and the effects of the nine-month-long West Coast port strike not yet quantified. This is not just a fleeting expression of a negative first quarter; it is a sign of things to come.

Stock markets are, of course, once again at all-time highs after a shaky start, despite nearly every single fundamental indicator flashing red. But as Zero Hedge recently pointed out in its article on artificial juicing of equities by corporations using massive stock buybacks, this is not going to last much longer, simply because the debt companies are generating is outpacing their ability to prop up the markets.

Read moreOne Last Look At The Real Economy Before It Implodes – Part 1

14 Signs That Most Americans Are Flat Broke And Totally Unprepared For The Coming Economic Crisis

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– 14 Signs That Most Americans Are Flat Broke And Totally Unprepared For The Coming Economic Crisis (Economic Collapse, Feb 23, 2015):

When the coming economic crisis strikes, more than half the country is going to be financially wiped out within weeks.  At this point, more than 60 percent of all Americans are living paycheck to paycheck, and a whopping 24 percent of the country has more credit card debt than emergency savings.  One of the primary principles that any of these “financial experts” that you see on television will teach you is to have a cushion to fall back on.  At the very least, you never know when unexpected expenses like major car repairs or medical bills will come along.

And in the event of a major economic collapse, if you do not have any financial cushion at all you will be a sitting duck.  Yes, I know that there are millions upon millions of families out there that are just trying to scrape by from month to month at this point.  I hear from people that are deeply struggling in this economy all the time.  So I don’t blame them for not being able to save lots of money.  But if you are in a position to build up an emergency fund, you need to do so.  We have been experiencing an extended period of relative economic stability, but it will not last.  In fact, the time for getting prepared for the next great economic downturn is rapidly running out, and most Americans are not ready for it at all.

The following are 14 signs that most Americans are flat broke and totally unprepared for the coming economic crisis:

Read more14 Signs That Most Americans Are Flat Broke And Totally Unprepared For The Coming Economic Crisis

Record Low Baltic Dry Casualties Emerge: Third Dry-Bulk Shipper Files For Bankruptcy In Past 3 Weeks

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– Record Low Baltic Dry Casualties Emerge: Third Dry-Bulk Shipper Files For Bankruptcy In Past 3 Weeks (ZeroHedge, Feb 23, 2015):

The unintended consequences of a money-printed, credit-fueled, mal-investment-boom in commodities (prices – as opposed to physical demand per se) and the downstream signals that sent to any and all industries are starting to bite. The Baltic Dry Index has plunged once again to new record lows and the collapse of the non-financialized ‘clean’ indicator of the imbalances between global trade demand and freight transport supply has the real-world effects are starting to be felt, as Reuters reports the third dry-bulk shipper this month has filed for bankruptcy… in what shippers call “the worst market conditions since the ’80s.”

Spot the credit-based mal-investment boom

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After 2 brief days of very marginal gains, The Baltic Dry Index dropped again…

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As Reuters reports,

A third dry cargo shipper has filed for bankruptcy this month following a collapse in freight rates to historic lows in what shippers call the worst market conditions since the 1980s.

Read moreRecord Low Baltic Dry Casualties Emerge: Third Dry-Bulk Shipper Files For Bankruptcy In Past 3 Weeks

China’s COSCO Dis-Assembles 8 Ships Amid Glut As Baltic Dry Hits Another Record Low

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– China’s COSCO Dis-Assembles 8 Ships Amid Glut As Baltic Dry Hits Another Record Low (ZeroHedge, Feb 16, 2015):

You know things are bad in the ship-building business when… amid considerably larger than expected losses, China’s COSCO announced that it has dis-assembled 8 vessels in January alone (including 3 bulk carriers) and will be decommissioning and disposing of them as it awaits a “more conducive” environment. It appears that is not coming anytime soon, as The Baltic Dry Index just hit 522 – a new all-time low (down a stunning 53 of the last 55 days).

As COSCO explains in its HKSE Statement:

The board of directors (the “Board”) of the Company wishes to inform the shareholders of the Company (the “Shareholders”) and potential investors that the Group had disassembled eight vessels (collectively, the “Vessels”), including five container vessels (Hutuo He, Xinhui He, Zhaoqing He, Yangjiang He and Yongding He) and three bulk carriers (Peng Jie, Peng Nian and Peng Cai) from 1 January 2015 to 31 January 2015.

Read moreChina’s COSCO Dis-Assembles 8 Ships Amid Glut As Baltic Dry Hits Another Record Low

World’s Largest Shipbuilder Reports $3 Billion Loss As Baltic Dry Index Hits New Record-er Low

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–  World’s Largest Shipbuilder Reports $3 Billion Loss As Baltic Dry Index Hits New Record-er Low (ZeroHedge, Feb 13, 2015):

“Some Shipping Folks Are Sinking…” South Korea’s Hyundai Heavy Industries, the world’s largest shipbuilder, has reported operating loss of KRW 3.25 trillion in 2014, or about USD $2.96 billion. The operating loss in 2014 is compared to a profit of KRW 802 billion in 2013. At 530, The Baltic Dry Index is at fresh record-erer lows…

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The World’s Best Known Global Shipping Index has Crashed To Its Lowest Level Ever

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– The World’s Best Known Global Shipping Index has Crashed To Its Lowest Level Ever (ZeroHedge, Feb 9, 2015):

Having fallen for 47 of the last 51 days, The Baltic Dry Index (tracking the cost of shipping dry bulk from iron ore to grains) has been collapsing in a well-documented manner by Zero Hedge (though not the mainstream media). With Cramer having told investors of its importance previously, it will be hard to ignore the fact that, as of this morning, the index of global shipping costs has never (ever) been lower at 554. We leave it to readers to decide what they think this means (but we already know what it means for shippers and ship-building companies).

Bullish?

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On the back of the total collapse in Chinese imports and exports, is this any surprise?

Charts: Bloomberg

Related info:

– Chinese Imports Crash & Worst January Export Plunge Since 2009 Sends Trade Surplus To Record High

The Baltic Dry Index Has Only Been Lower Than This 8 Days In 30 Years

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– The Baltic Dry Index Has Only Been Lower Than This 8 Days In 30 Years (ZeroHedge, Feb 6, 2015):

At 559, The Baltic Dry Index (having now dropped 46 of the last 50 days and 12 days in a row) is just 5 points above its all-time record low from 1986. In fact, the global freight index has only been lower for 8 days during the July/August period of 1986 in its 30 year history…

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We are sure this is nothing to worry about and merely “transitory.”