baltic dry index rises sharply by 182 to 1498, page-3

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Published: February 5 2009 20:49 | Last updated: February 5 2009 20:49 The Baltic Dry Index, the benchmark for freight costs for dry bulk commodities such as iron ore, coal and iron, rose sharply again on Thursday, taking its gains over the past two days to almost 30 per cent on signs of a tentative recovery in Chinese iron ore imports.

Shipping brokers said the recovery was more a correction from the extreme fall between October and December of last year, helped by a pick up in Chinese demand for iron ore, than a sign that the world has emerged from the financial and economic crisis. Even if this week’s jump is impressive – the index rose almost 15 per cent on Wednesday, the largest one-day increase since 1985 – the Baltic Dry is still well below last year’s all-time high of 11,793 points. In the short term, shipbrokers see signs of stronger freight demand, particularly for the largest vessels, or Capesizes. Peter Norfolk, head of research at shipbrokers Simpson Spence & Young in London, said there had been an increase in iron ore chartering from Brazil, and to a lesser extent from Australia, to Chinese ports. “There is a squeeze of tonnage availability in the short-term”, he said