The Baltic Dry Index Runs Aground

The Baltic Dry Index is THE reliable measure of the cost-of-shipping dry goods around the world.

The Baltic Dry Index has fallen to 684 points. The last time it fell this low was over 22 years ago on April 15,1986. If the rates continue to plummet the index may approach its lowest recorded level of 554, in early August 1986.

Hmmmm.

Here's one piece of the puzzle:

Cargo cancellations remain the chief problem for owners, as many receivers struggle to open letters of credit, as the global financial crisis restricts access to trade finance

Another piece, of course, is the utter lack of demand.

HT: Dreher