The steady rise in the Baltic Dry Index, seen by many as the key indicator to world commodity trade, has prompted rises in Japanese stock prices with the Nikkei and Topix up for the third consecutive day.
The steady rise in the Baltic Dry Index, seen by many as the key indicator to world commodity trade, has prompted rises in Japanese stock prices with the Nikkei and Topix up for the third consecutive day. Shipping shares are leading the charge as the BDI continues to climb, clawing its way back after the collapse of over 90% last year with the strength of the Yen moderating gains. The drop in Australian employment figures also provided a market boost. NYK, Mitsui OSK and K Line shares all rose by an average of almost 7%.
Although prices to charter dry bulk vessels are still well down on the euphoric highs of latter days the growth is seen as a more cold blooded approach with demand for bulk commodities rising steadily as stocks run low. No one doubts that the market has shrunk and times will be tough for the near future but most of the market feels that the bottom has been reached and a slow rise has begun.
In the light of this the CEO of Hong Kong"s biggest commodity ship operator, Pacific Basin Shipping Ltd, stated in an exclusive TV interview that his company considered the possibility of adding to their fleet in the second half of next year.
This seems to be the pattern which many Asian, and indeed European vessel operators believe to be the most likely future for the industry. With the spectre of huge overcapacity looming as more new builds cause vessel prices to slump, coupled with the knowledge that freight rates are likely to fall with the increased level of competition, the surviving companies are sharpening their steely knives ready for the feast.