May 7, 2026 (Bloomberg) – A major indicator of bulk shipping rates has reached its highest point since December 2023. This increase is largely due to a higher demand for Capesize ships and a decrease in the number of ve...
May 7, 2026 (Bloomberg) – A major indicator of bulk shipping rates has reached its highest point since December 2023. This increase is largely due to a higher demand for Capesize ships and a decrease in the number of vessels available for transporting bulk goods.
The Baltic Dry Index rose by 5.6% to 2,991 points on Wednesday, marking a fourth consecutive day of gains. This index measures freight rates for different sizes of ships, including Capesize, Panamax, and Supramax, which carry raw materials like iron ore, coal, and grain.
According to Pranay Shukla, head of dry bulk freight and commodities research at S&P Global Energy, the Capesize market has seen significant strength in the past two weeks. This surge is attributed to a decrease in ship availability in the Pacific, disruptions in iron ore exports from Brazil, and speculation on future freight rates.
Export activity for bulk commodities was robust in April and is expected to remain strong throughout this month and into June, based on data from S&P Global Energy. The Capesize segment represents about 40% of the Baltic Dry Index and is especially linked to iron ore, which is essential for steel production.
The ongoing conflict in the Middle East has also contributed to the rise in rates. The war in Iran has created volatility that has intensified movements in the freight market, boosting overall market sentiment, as noted by the shipbroker Ifchor Galbraiths.
Iron ore futures in Singapore remained steady at $110.70 per ton as of 11:49 a.m. local time, after an increase of 1.8% in the previous session, reaching its highest level since October 2024. This spike occurred as China resumed operations after a holiday.