The recent drop in bulk ocean shipping costs strengthens Canada’s ability to compete with other countries, particularly those closer to Canada’s export markets, says provincial crops analyst Neil Blue.
High rates just prior to the 2008 recession, prompted shipping firms to build new vessels and there’s now lots of shipping capacity. That’s set the stage for a deep drop in the Baltic Dry Index (BDI), which was at 1,200 as recently as August. “During the first week of 2016, the BDI was quoted at 445 points, the lowest since the Baltic Dry Index records started in 1985,” said Blue.
Although lower rates do not necessarily translate into higher Prairie crop prices, it’s positive for sales and shipment volumes, he said.