"Eight-month high for the Baltic Dry
The Baltic Dry index - a benchmark measure of dry shipping rates and thus global trade - rose 7.55 per cent today, bringing it to an eight month high after its disastrous collapse at the end of 2008.
Over May alone, the index has risen 77 per cent.
Not that any of that need necessarily spell recovery.
It’s widely accepted that massive Honda Effect destocking has taken place over the past few months, which explains the swiftness of the collapse in shipping rates. Now that stocks have been adequately run down, production will start to ramp up again, and with it, shipping. And while that will provide a significant initial fillip to shipping rates, it won’t necessarily lift them anywhere near their eighteen month highs. For that, an actual economic recovery would be rather necessary. With global GDP shrinking at its fastest rate since the second world war, that ain’t on the horizon.