Baltic Index Declines to 1-year Low

The Baltic Exchange's dry bulk sea freight index .BADI, which tracks rates for ships carrying dry bulk commodities, fell for a sixth straight session on Tuesday to an over one-year low as rates weakened across all vessel segments.

The overall index, which factors in rates for capesize, panamax and supramax shipping vessels, dropped 29 points, or 3.03%, to 928 points - its lowest since June 2023.

The Baltic index is expected to decrease in the lead up to the Chinese new year, as this is typically a period of weaker demand for the sector, said an economist at the Baltic and International Maritime Council (BIMCO).

"We expect a weaker supply-demand balance in 2025 compared to 2024, especially if safety is restored in the Red Sea and ships are able to return."

Companies around the world are not ready to return to the Red Sea trade route in the wake of a Gaza ceasefire deal because of uncertainty over whether Yemen's Houthis will continue to attack shipping, industry executives said.

The capesize index slipped 43 points, or 3.24%, close to a two-week low of 1,284 points. While, average daily earnings for capesize vessels, which typically transport cargoes of 150,000 metric tons, such as iron ore and coal, lost $361 to $10,647. Prices of iron ore futures rose for a ninth straight session as U.S. President Donald Trump did not immediately impose tariffs on trading partners, but kept investors on edge with his tariff plans, which capped the gains.

The panamax index slipped 19 points to 874 points, lowest since February 2023. Average daily earnings for panamax vessels, which usually carry about 60,000-70,000 tons of coal or grain, dropped by $174 to $7,862.

Among smaller vessels, the supramax index .BSIS was down 24 points at 703 points, its lowest in over a year. It fell for a 28th straight session.