Dry bulk — the world’s largest ocean shipping market in terms of volume — is off to one of its worst starts ever in 2023.
The sector’s famous bellwether, the Baltic Dry Index (BDI), is viewed in financial circles as an important indicator of global economic health. The BDI fell to 530 points on Thursday, down 91% versus October 2021.
Since London’s Baltic Exchange began publishing the BDI in 1985 (originally the Baltic Freight Index), it has only been lower than it is today during two other periods: in the first half of 2020, at the height of pandemic lockdowns, and in the first half of 2016, during an extreme downturn for the dry bulk sector.
This sounds like an ominous sign for the world economy. But there are industry-specific reasons why things may not be quite as dire as they seem.
