In the latest analysis of Baltic Exchange Dry Bulk Investor Indices data, Urs Dür, Principal at Zuoz Industrial LLC, examines the current pressures on dry bulk freight rates and their implications for asset values. Despite firm asset valuations supported by low orderbooks and evolving regulatory standards, softening demand for key commodities such as iron ore and coal is weighing heavily on freight rates. Urs highlights that with spot earnings and forward freight agreements failing to meet breakeven levels, current asset values for Capesize and Panamax vessels lack fundamental investment support. While future demand drivers, including China’s potential stimulus and the Simandou Mine project, may boost tonne-mile demand, near-term prospects suggest asset values are likely to soften.

Click here to download a full copy of the latest dry bulk report.

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The Baltic Exchange publishes a set of investor indices for the major dry bulk and tanker sectors, which includes the Baltic Residual Risk Index, a ratio of the residual value of the vessel against its recycling value, and the Baltic Residual Value Index, which calculates the value by taking the written down cost of a five year old vessel by fixing the earnings on the basis of a five year timecharter and adding back the operating costs.

The Baltic Exchange Investor Indices (BII) are an easy to use online analytical dashboard displaying data relevant to vessel investment decisions, residual value, health of earnings, spot and five-year timecharter earnings, purchase & recycling values, and running costs.

They offer a high level of clarity and transparency for investors in all bulker and tanker vessel types. Gas carrier assets will also be added to the service at a later date.

Subscribers to the Baltic Exchange Investor Indices are offered a health of earnings index, which compares spot income with daily running costs; a residual value index that provides an implied write-down value of the vessel over five years; and an implied residual risk assessment that gives the recycling steel value of the vessel as a ratio of its residual value.

You can take a week's free trial and access all of the Baltic Exchange’s daily freight market information including all published wet, dry, gas, container and airfreight indices, fixture lists, market reports, forward curves and asset values via our website and mobile App.

The Baltic Exchange has produced an official White Paper to discuss the inner workings of its Investor Indices. The White Paper looks in detail at the various indicators provided by the Baltic Exchange for dry bulk and tanker shipping investors, how they are constructed and how they be used to help support entry and exit decisions in these sectors. Click here to read the White Paper in full.