WINNIPEG — The cost of shipping dry goods across the ocean continues to explore uncharted waters with the Baltic Dry Index now below 300 points for the first time.
The BDI was quoted at 298 points Feb. 4, marking a new low since records began in 1985.
The index was trading above 1,200 as recently as the beginning of August but has struggled ever since with “new record lows” a consistent headline over the past two months.
The index is compiled daily by the London-based Baltic Exchange and provides an assessment of the price of moving major raw materials by sea, including grain.
An overcapacity of ships, the slowdown in Chinese demand for building materials, weakness in crude oil and declining commodity prices have all been cited as contributing factors to the lower freight rates.
The lower freight rates even the playing field for Canadian grain and oilseed exporters into many markets, but they are already causing some shipping companies to dock their boats and others to go out of business.