China, measured by dry bulk shipping, has become a matter of some concern in certain circles, as reported at here":
The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry commodities was flat on Monday, as weak Chinese demand weighed on rates for dry bulk vessels.***China is the world's biggest consumer of iron ore, coal and other base metals, but recent data has shown the economy cooling more quickly than expected, with industrial output growth slowing sharply in April.Analysts expect the dry bulk segment to face short-term weakness as Chinese buyers are deferring delivery or have defaulted on coal and iron ore deliveries to weather the current slide in steel and raw material costs.
Well, there was a brief bump up a day or so ago on the Baltic Dry Index when China announced a continuation of its "growth" plan, but . . . here's graph of the BDI:
UPDATE: Oh, that title quote? From The Guardian here:
Chinese consumers of thermal coal and iron ore are asking traders to defer cargos and defaulting on their contracts, the Financial Times reported on Monday.
The newspaper cites traders as saying the deferrals and defaults, which have only emerged in the last few days, have contributed to a drop in iron ore and coal prices.
"We have some clients in China asking us this week to defer volumes," a senior executive with an unnamed global commodities trading house is quoted as saying.
The deferrals are described by the FT as the clearest sign yet of the impact of the country's economic slowdown on the global raw materials markets.
"China is hand to mouth at the moment," the unnamed source is quoted as saying.
The BDI described here:
Baltic Dry Index is a daily average of prices to ship raw materials. It represents the cost paid by an end customer to have a shipping company transport raw materials across seas on the Baltic Exchange, the global marketplace for brokering shipping contracts. The index is quoted every working day at 1300 London time. This index can be used as an overall economic indicator as it shows where end prices are heading for items that use the raw materials that are shipped in dry bulk.
In recent years, the world has seen the centre of maritime gravity moving to Asia. Asian countries’ share of world seaborne trade increased to 39% in 2006 (compared with 31% in 1996) and where nearly half of the world’s merchant fleet is domiciled in Asia. 13 of the world’s top 20 ports are also located in Asia, handling around 36% of the world’s containers. Three of the world’s largest shipbuilding nations are in Asia accounting for 90% of global market share.ReplyDelete
If they default to send the requirements then definitely it affects the market and economy.ReplyDelete