MarketsFarm — Ocean freight rates have come under pressure over the past month as demand for freight backs away, which could be seen as a sign of the slowing global economy.
The Baltic Dry Index (BDI), which is a major indicator of shipping rates, settled at 2,081 points on Monday, up 14 points from Friday’s close but near the lowest levels in three months.
The index has lost roughly 1,300 points over the past six weeks, although it still well above the lows of the calendar year near hit in January.
The BDI is compiled by the London-based Baltic Exchange and provides an assessment of the price of moving major raw materials by sea. The overall BDI includes sub-sectors for the different classes of ocean vessels — including capesize, panamax and supramax. It is often seen as a leading indicator of global economic activity.
Canada is at a freight disadvantage compared to its competitors exporting grains and oilseeds into many markets, with higher freight rates heightening that disadvantage.
— Phil Franz-Warkentin reports for MarketsFarm from Winnipeg.
