WINNIPEG, Jan. 28 (CNS Canada) – The ocean floor remains one of the few unexplored mysteries of the world.
However, the cost of traversing those waters continues to reach new depths, as the Baltic Dry Index sinks ever lower.
The Baltic Dry Index (BDI) was quoted at 325 points on Thursday, marking a new low since records began in 1985, and only two weeks since falling below 400 points for the first time ever.
The index was trading above 1,200 as recently as the beginning of August, 2015, but has struggled over the past five months.
The BDI 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, according to freight analysts.
For Canadian grain and oilseed exports, the lower shipping rates even the playing field in some cases by lessening the importance of shipping costs in the final price to the buyer.
However, declining rates are already causing some shipping companies to dock their boats and others to go out of business.
