Dalian: The Baltic Dry Index suffered its worst five days last week since the vertiginous drops seen in October 2008. The index dropped by almost a fifth and leaves owners scratching their heads at what will happen this week. As ever the index's ebb and flow was dictated by China. The Chinese are now playing serious hardball with Rio Tinto and BHP Billiton to finally tie up an iron ore pricing deal. Putting pressure on the mining giants, mills have reduced their imports while the local iron and steel association is suggesting it will make deals with small iron ore mining countries outside of Australia and Brazil to not always be at the behest of the big three miners who also include CVRD.
The index closed Friday on 2,772 points, down 17% in a week.
"The Chinese have backed off and it's starting to show in the number of shipments this month," a Cape Town-based official at Island View Shipping SA, Africa's biggest commodities shipping line, told Bloomberg on Friday. [10/08/09]
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