Forex Baltic

Every day the Baltic Exchange issues a number known as the Baltic Dry Index. The London-headquartered exchange provided the BDI as an assessment of the “price of moving the major raw materials by sea.”  The index includes within its figure 26 shipping routes which are measured on a time-charter as well as voyage basis.  The BDI covers Capesize, Handymax and Panamax dry bulk carriers. Included are also a wide variety of commodities being shipped, such as coal, iron ore and grain.

The BDI can trace its routes all the way back to the Virginia and Baltick Coffeehouse in the financial district of London in the year 1744.

Each business day the Baltic Exchange researches the cost of shipping around the world from brokers. They make inquiries concerning how much it would cost to reserve a variety of cargoes of raw materials and send them on various routes around the world.

The index is an important number to economists, businessmen and investors because it is a measure of the demand for shipping capacity versus the supply of dry bulk carriers. The Baltic Index is a crucial measure of the state of the global economy because it is “an assessment of the price of moving the major raw materials by sea,” according to The Baltic, “… it provides both a rare window into the highly opaque and diffuse shipping market and an accurate barometer of the volume of global trade — devoid of political and other agenda concerns.”