Baltic Dry Index = 0 ships at sea?!

[Adeptus]

According to ZeroCred, the Baltic Dry Index signals that as of today there are ZERO commercial ships travelling between Europe and North America - apparently for the first time in history.

Can somebody verify this story and explain why this is really happening and the implications?

One would expect with Oil at decade lows, that this would make it more economically viable to be shipping stuff across the oceans. Has intercontinental demand really crashed this drastically, seems very improbable to me.

http://www.zerohedge.com/news/2016-0...-halt#comments

[dcarrigg]

Re: Baltic Dry Index = 0 ships at sea?!

According to ZeroCred, the Baltic Dry Index signals that as of today there are ZERO commercial ships travelling between Europe and North America - apparently for the first time in history.

Can somebody verify this story and explain why this is really happening and the implications?

One would expect with Oil at decade lows, that this would make it more economically viable to be shipping stuff across the oceans. Has intercontinental demand really crashed this drastically, seems very improbable to me.

http://www.zerohedge.com/news/2016-0...-halt#comments

I don't know much about big liner shipping. And I don't believe much from zerocred. But even if it were true, I'd imagine it's because BDI is exclusively the big boys, Handysize, Supramax, Panamax, and Capesize--which means 40,000 DWT plus. And last I heard, those big boys were being gobbled up for oil storage because of supply gluts (this is the part I'm really not sure about, just something I heard on the radio). Could just be stuff is coming across on smaller ships.

[Mega]

Re: Baltic Dry Index = 0 ships at sea?!

Strange, car sales have never been higher................
Fears of fresh steel jobs losses as crisis continues to hit industry

Hundreds of steel workers at Port Talbot plant in Wales could lose their jobs




British steel makers have called for support from the government Photo: Alamy









By Alan Tovey, Industry Editor

11:18AM GMT 11 Jan 2016
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3 Comments


Union chiefs are to meet with Tata Steel bosses as worries grow that the company could cut jobs at its giant Port Talbot plant.


It is feared that hundreds of the 4,000 steelworkers at the Welsh plant could lose their jobs in the latest sign that the crisis in the industry is not yet over.


Some local reports have suggested that up to a quarter of the staff could go as Tata mulls a major restructuring to keep the plant open.

Local MP Stephen Kinnock said: “It is going to be a very large number of job losses, it won't be in the tens, it's much more likely to be in the hundreds.”


Britain’s steel industry is reeling as it faces cheap imports from China and struggles to compete in a market where it faces higher costs, such as labour and energy, than many of global rivals.


The UK’s tax regime also discourages investment in new equipment needed to make steelworks more efficient so they can compete on international markets.
Feeling the heat: Cheap imports and high energy costs have heaped pressure on British steel companies
Trade body UK Steel has successfully led a campaign for a reduction in green levies placed upon the energy-intensive industry, but it is feared that this will not be enough to keep Britain’s steelworks alive.

The crisis among British steel plants came to a head in October last year when Tata announced 1,200 jobs would be cut, mainly at its Scunthorpe plant but also at two sites in Scotland which would close.

This came on top of 700 positions going at Tata’s speciality steel plant in Stocksbridge, South Yorkshire, last summer, as well as 250 contract roles at the company’s plant in Llanwern, Wales.

A further 2,000 steel jobs went last year when SSI’s plant in Redcar shut and Caparo collapsed into administration.
A spokesman for steelworkers’ union Community said: “These reports of potential job losses at Port Talbot should serve as a stark reminder of the ongoing steel crisis and the urgent need for government to deliver upon the agreed steps to protect this vital foundation industry.

“We need a level playing field for UK steel makers, especially on issues like business rates and energy costs. Community will be meeting with Tata Steel in the coming weeks to discuss these reports and how best we can build a sustainable steel industry together.
”
Tata is in exclusive discussions with turnaround specialist Greybull about a potential sale of its so-called “long products” unit at Scunthorpe which could save hundreds of jobs.

Talks – exclusively revealed by the Telegraph – are ongoing but it is understood that an agreement may hinge on Greybull being able to negotiate a wide-ranging restructuring that includes scrapping the final salary pension scheme and a shake-up of pay and bonuses.

In return, the Chelsea-based family investment office is willing to inject up to £400m into the long products business which it is convinced it could return to health from its current loss-making status.

A spokesman for Tata said: "We have no announcements to make at present but if we had significant news we woulfd always tell employees first."

[thriftyandboringinohio]

Re: Baltic Dry Index = 0 ships at sea?!

Here's a long term chart of the Baltic dry Index.

It is a measure of the COST to ship bulk commodities in giant ocean ships, and it includes the relationship between the supply of big ships; the demand for big ships; and the cost to operate the big ships.

Global commodity demand is down, especially Chinese demand for coal and iron ore.
The price of fuel (bunker oil) is down with the general price of oil.
And the supply of big ships doesn't change very fast, it takes years and years to build them.

[santafe2]

Re: Baltic Dry Index = 0 ships at sea?!

Here's a long term chart of the Baltic dry Index.

It is a measure of the COST to ship bulk commodities in giant ocean ships, and it includes the relationship between the supply of big ships; the demand for big ships; and the cost to operate the big ships.

Global commodity demand is down, especially Chinese demand for coal and iron ore.
The price of fuel (bunker oil) is down with the general price of oil.

The problem is the massive slowdown of infrastructure build-out in China which is running head-on into a fleet of Capesize and Panamax that has doubled in the last 8-10 years.

[GRG55]

Re: Baltic Dry Index = 0 ships at sea?!

The problem is the massive slowdown of infrastructure build-out in China which is running head-on into a fleet of Capesize and Panamax that has doubled in the last 8-10 years.

Bingo!

Massive credit fuelled capital mis-allocation on a scale so grand that now it has finally exhausted it is influencing the entire global supply chain (supply to China as well as what China supplies to the ROW such as steel), and endangering entire nations that became overdependent on China for both market and funding (the "B" in BRICS comes immediately to mind).

For at least a half-decade it was obvious to anyone watching without swallowing the propaganda Kool-Aid that China's economic model was simply unsustainable.

China could not keep printing Yuan with abandon and appreciate the currency exchange rate against the reserve currency indefinitely. In 2014 it stopped the controlled appreciation and the policy became one of holding the peg. Now that the currency has been accepted into the IMF SDR basket (which may prove to be a serious mistake) the brakes are off and the Yuan is headed south. Nobody should be surprised.

This is but one tangible measure. There are lots more from the empty shopping malls, opera houses, apartment blocks, entire cities, manufacturing capacity that dwarfs global consumption volumes once netted of the grossly inflated Chinese internal demand (pick anything: cement, steel, glass, autos, electricity, coal, oil, LNG, iron ore, machine tools, Gucci handbags, melamine milk, anything).

The nation that is going to most benefit from China's insanity is the nation China was allegedly going to "crush". The people I speak to that are the most down on the USA economic prospects are Americans themselves. Clearly the rest of the world doesn't agree given what they are prepared to bid for the USA's currency and the USA's companies.

[jpatter666]

Re: Baltic Dry Index = 0 ships at sea?!

The nation that is going to most benefit from China's insanity is the nation China was allegedly going to "crush". The people I speak to that are the most down on the USA economic prospects are Americans themselves. Clearly the rest of the world doesn't agree given what they are prepared to bid for the USA's currency and the USA's companies.

China is caught in a dual-trap of being thought of as a low-cost producer (but with constantly rising labor costs) and a reputation for poor (if not outright dangerous) quality. You could see it coming here before it became generally viewed -- I remember several conversations (I think one was about GRG55's bunker) on making sure various parts did NOT come from China due to the quality issues.

[jk]

Re: Baltic Dry Index = 0 ships at sea?!

I'm fairly sure that some Chinese dog food (food FOR dogs) killed a dog of mine when my wife was in a hurry and picked up something not the usual. Things like that and melamine milk leave a lasting impression. I'm old enough to remember that when I was a child "made in Japan"meant cheap junk. But it was honest cheap junk, if you know what I mean. It didn't pretend to be something it wasn't. I try to avoid goods made in China, but in some categories that's hard to do. I would NEVER knowingly eat food produced or processed in China.

[thriftyandboringinohio]

Re: Baltic Dry Index = 0 ships at sea?!

.... I would NEVER knowingly eat food produced or processed in China.

I agree with you jk and I too always try to avoid eating any food from China, but it's getting harder for you and I to choose our food wisely.

At the risk of hijacking this thread, here' a Forbes article, this topic got pretty good coverage in many places recently.
http://www.forbes.com/sites/nancyhue...beef-and-pork/

DEC 21, 2015 @ 04:56 PM 55,532 VIEWSQuashing Consumers' Right-To-Know, Congress Repeals Country-Of-Origin-Labeling For Beef And Pork

That next steak or pork chop you buy at the grocery store could be from Mexico and beyond, but you’ll never know it.
On Friday, Congress repealed the country-of-origin-labeling rule (COOL) on beef and pork after the World Trade Organization (WTO) imposed $1 billion in retaliatory import tariffs against United States if the rule was not overturned. The repeal was part of the omnibus spending bill signed by President Obama on Friday.
COOL mandates labels on packaging that reveal the country (or countries) where the meat animal was born, raised and slaughtered. While beef and pork will no longer have to comply with COOL rules, chicken and lamb must still be labeled.
Canada and Mexico had argued that the mandatory U.S. labeling program discriminated against meat imports and violated WTO limits on what sorts of product-related “technical regulations” WTO signatory countries are permitted to enact. Meatpackers also complained that the cost of complying with the COOL program was too burdensome...

[Adeptus]

Re: Baltic Dry Index = 0 ships at sea?!

I agree with you jk and I too always try to avoid eating any food from China, but it's getting harder for you and I to choose our food wisely.

Funny. As a Canadian I live by the same rule re:Chinese food, but I also have a rule#2: Where possible, avoid eating any food from the USA. The amount of hormones and pesticides and crap you guys allow your corporations to put into some of your foods is frightnening, to say nothing of the moral compass of the giant Monsanto. Lastly, I also keep in mind the carbon impact of buying local vs importing from California (or South America for that matter).

[shiny!]

Re: Baltic Dry Index = 0 ships at sea?!

Funny. As a Canadian I live by the same rule re:Chinese food, but I also have a rule#2: Where possible, avoid eating any food from the USA. The amount of hormones and pesticides and crap you guys allow your corporations to put into some of your foods is frightnening, to say nothing of the moral compass of the giant Monsanto. Lastly, I also keep in mind the carbon impact of buying local vs importing from California (or South America for that matter).

We don't allow it. We don't have a say in these things. We have an oligarchy- the best government that corporations can buy.

[Mega]

Re: Baltic Dry Index = 0 ships at sea?!

The US is trying to force Europe to allow them to REMOVE food labeling........................so far we say no!
BTW Shinny, i been chatted up by a nice lady at work............thing is there is something og a age gap...........she 29 & i am the wrong side of 50!

Mike

[Mega]

Re: Baltic Dry Index = 0 ships at sea?!

[thriftyandboringinohio]

Re: Baltic Dry Index = 0 ships at sea?!

The US is trying to force Europe to allow them to REMOVE food labeling........................so far we say no!
...

Mike, I've been following this and the problem is not the U.S (directly).
The Word Trade Federation is protecting companies who can't sell their food when customers know where it comes from.

The recent WTF ruling against the U.S. was started by beef companies in Mexico and Canada.
People in the US prefer beef from the U.S., and those two nations filed a complaint that was enforced.

The theory is that when product labels show honest and important information, and that info discourage sales from some places, then the honest truth must be removed from the labels.
Now the customer can't know the truth, and so some people will accidentally purchase a product they would rather avoid.

Apparently that is now considered good fair trade policy - hiding information that people use to make purchasing decisions.

P.S.
Am I the only person that finds it hilarious that the acronym for the World Trade Federation is "WTF"?

[santafe2]

Re: Baltic Dry Index = 0 ships at sea?!

P.S.
Am I the only person that finds it hilarious that the acronym for the World Trade Federation is "WTF"?

Nope. I was laughing all the way through the post. They really are that clueless.