AGO 0.00% 4.5¢ atlas iron limited

demand in capsize vessel almost trippled, page-16

  1. 30,924 Posts.
    lightbulb Created with Sketch. 174
    The heading is not correct. Demand for shipping has not tripled - or, if it has, that is not what the index measures.

    http://marine-transportation.capitallink.com/indices/baltic_exchange_chart.html?ticker=BCI

    The index purely measures what you have to pay for a vessel. Yes, prices have tripled since June, but it is an inelastic market and a small increase in demand can lead to a rapid increase in price until mothballed ships can be brought back into use.

    So for Atlas it is actually bad news. Costs have increased.

    I used to think that the Baltic indices were the Holy Grail indicator of global economic strength, but there are so many variables that they are almost useless for that purpose. Good if you want to know the price of shipping - dangerous if you think you can see global trends!
 
watchlist Created with Sketch. Add AGO (ASX) to my watchlist

Currently unlisted public company.

arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.