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So which specific STI stocks are directly impacted by the BDI? that would be interesting to know.
BDI 11,648 - 123
BDI 11,771 - 22
BDI 11,793 + 84
BDI 11,709 + 250.
Tks Terence.
Have a nice wkend ahead!
BDI 11,066 + 418
My pleasure
Terence,
Thank you for the daily update. Appreciates.
terencefok ( Date: 15-May-2008 07:27) Posted:
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BDI 10,648 + 294
BDI 10,354 + 134
Just to elaborate on Fairygal's explanation on the shipping industry. Ships today are quite specialised and can be broadly categorised into containers, bulk carriers and tankers. The first two have been covered by Fairygal.....tankers are basically liquid carriers....usually crude oil. Of course, there are other very specialised ships like RoRo (roll on roll off car carriers)....e.g Spore Ship.; and LNG carriers..which we will not cover here.
Shipping companies have different modes of earning their revenues.
Usually the larger, more established companies run 'liners' or long term charters (rental). Liners are usually containers carriers......they run a certain route on some fixed schedule and they pick up and drop off cargos at the ports of call (like SMRT buses picking up/dropping off passengers) .....eg of container liner operator is NOL. Some ship owners charter (rent out) their ships on long term (anywhere from 1-10 years). The charter rates are usually fixed.....both containers and bulk carrier owners practice this.
Then there are the 'spot' charters....where rates are negotiated voyage by voyage. A good example of this is Courage Marine (operating only bulk carriers)......where most of their revenues are from 'spot'.....So, CM's fortunes are very dependant on the fluctuations of BDI.
This brief explanation is by no means comprehensive, but hope it clarifies matter abit more.
terencefok ( Date: 13-May-2008 09:33) Posted:
| The index that tracks shipping rates. Maybe some experts can help to elaborate a little |
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Container ships are
cargo ships that carry all of their load in truck-size containers, in a technique called
containerization.
A
bulk carrier, bulk freighter, or
bulker is a
merchant ship specially designed to transport unpackaged
bulk cargo, such as grains, coal, ore, and cement in its
cargo holds.
oh, care to share what is the difference?
Bear in mind that there is a difference between dry bulk shipping and container shipping.
| Baltic Dry Index (BDI) |
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A shipping and trade index created by the London-based Baltic Exchange that measures changes in the cost to transport raw materials such as metals, grains and fossil fuels by sea. The Baltic Exchange directly contacts shipping brokers to assess price levels for a given route, product to transport and time to delivery (speed).
The Baltic Dry Index is a composite of three sub-indexes that measure different sizes of dry bulk carriers (merchant ships) - Capesize, Supramax and Panamax. Multiple geographic routes are evaluated for each index to give depth to the index's composite measurement.
It is also known as the "Dry Bulk Index".
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Changes in the Baltic Dry Index can give investors insight into global supply and demand trends. This change is often considered a leading indicator of future economic growth (if the index is rising) or contraction (index is falling) because the goods shipped are raw, pre-production material, which is typically an area with very low levels of speculation.
Because the supply of large carriers tends to remain very tight, with long lead times and high production costs, the index can experience high levels of volatility if global demand increases or drops off suddenly. The Baltic Exchange also operates as a maker of markets in freight derivatives, a type of forward contract known as FFAs (forward freight agreements) that are traded over-the-counter. |
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The index that tracks shipping rates. Maybe some experts can help to elaborate a little
Pardon my ignorance. But what the heck is a Baltic Dry Index?
terencefok ( Date: 13-May-2008 07:22) Posted:
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BDI 10,220 - 17
