The Baltic Dry Index is now trading below 1000 points. Yesterday marked one more downward session for the freefalling index, tracking dry bulk shipments of commodities like iron ore and coal. The continuous slump has seen the index dropping to 982 points, from an all-time high of 11,793 points last
May, reports Hellenic Shipping News.

The halt in dry bulk trade is the aftermath of the financial and credit crisis which hit the world markets from the middle of September. Banks are hesitant in releasing letters of credit, traders are reluctant to take
chances and the global steel industry is also witnessing a  drop in demand.

Therefore, cargoes are scarce, demand for ore carriers has slumped and as a result freight rates have too.

Clarkson’s latest weekly report said that “prevailing turmoil in the financial markets and steadily declining freight indexes have also left the second hand market in a continued state of disquiet”. It continues by stating that concluded arrangements for vessels at prices difficult to justify in the light of the current financial and trading climate are renegotiated or falling altogether.