A Leading Economic Indicator Goes South.....

[Warthogg]

This indicator is the Baltic Dry Index (BDI). This indicator leads as the cargoes measured are raw materials from which other products are made.

There are no politics in the BDI. When, for example, shipments of iron ore decrease, steel production will decrease.

The BDI has dropped 36.42% year-to-date (yes, I know today is only January 12, 2012) and has been dropping since 12/11/11..........from 1930 on 12/11/11 to 1105 on 1/12/12.

The Baltic Dry Index (BDI) is a number issued daily by the London-based Baltic Exchange. Not restricted to Baltic Sea countries, the index tracks worldwide international shipping prices of various dry bulk cargoes.

The index provides "an assessment of the price of moving the major raw materials by sea. Taking in 26 shipping routes measured on a time charter and voyage basis, the index covers Handymax, Panamax, and Capesize dry bulk carriers carrying a range of commodities including coal, iron ore and grain."[1]

http://en.wikipedia.org/wiki/Baltic_Dry_Index

[American Rage]

Shipped from where to where?

I wouldn't be surprised if as the our shipping dropped off, China's grew in proportion.

Afterall, doesn't China now have legal rights to many of those raw materials?

[Warthogg]

Shipped from where to where?

Shipping measured is international in scope. I 'think' maybe 26 routes routes are measured but can't remember where I saw that number.



Wart


ETA:

Baltic Dry Index (BDI) - Important Indicator Of What Is Happening To ...
http://www.stocks-for-beginners.com/...dry-index.html
Jul 27, 2010 – The Baltic Dry Index provides an assessment of the price of moving the ... in 26 shipping routes measured on a time-charter and voyage basis. ..

[Warthogg]

HARPEX measures finished goods shipped by container is also down.


Wart

[Penguin]

While it probably isn't good I wouldn't worry too much. After all more stuff is shipped before the holidays and then after you would expect a decline.

[American Rage]

So, a global slow down has began.

I bet energy and food haven't gone down, yet.

Have they?

[mriddick]

Last year in Jan I sold $180,000, this year it's looking like closer to $50,000.

[American Rage]

Last year in Jan I sold $180,000, this year it's looking like closer to $50,000.

that's not good

Can you hint/tell as to what you sale?

Is it domestic or international sales?

Generally speaking of course.

[mriddick]

that's not good

Can you hint/tell as to what you sale?

Is it domestic or international sales?

Generally speaking of course.

Inks and coatings for the printing market, for the last two years at a board plant making boxes for domestic food, soap and department store use (shirt boxes). Normally fast food is pretty bulletproof business (in down times business actually goes up) but to me it looks like everything is way down so far this year.

[Warthogg]

So, a global slow down has began.

I bet energy and food haven't gone down, yet.

Have they?

Hell no.

I mean food and energy are not even subject to inflation.....right ???? I mean.....


Wart

[Warthogg]

Inks and coatings for the printing market, for the last two years at a board plant making boxes for domestic food, soap and department store use (shirt boxes). Normally fast food is pretty bulletproof business (in down times business actually goes up) but to me it looks like everything is way down so far this year.

Not exactly reactionary businesses.......not good.


Wart

[cevulirn]

While it probably isn't good I wouldn't worry too much. After all more stuff is shipped before the holidays and then after you would expect a decline.

As a raw materials index, the holidays would have little impact, or at least the holiday impact would have happened months ago.

[O.S.O.K.]

Inks and coatings for the printing market, for the last two years at a board plant making boxes for domestic food, soap and department store use (shirt boxes). Normally fast food is pretty bulletproof business (in down times business actually goes up) but to me it looks like everything is way down so far this year.

This may sound stupid but you may need to find the companies that are up and sell them

My company for example prints labels on it's products (probably not much of a customer for you) but we were up 5% over previous year last year - my division was up 24%. We are a small food company.

Point is, maybe you can prioritize your sales efforts based on those industries or companies that are actually trending up?

Sometimes we get so involved in the trees we forget to step back and look at the forrest - and somebody not intimately involved can help with that.

Just a thought.

-------

On another note - this illustrates the "trickle down" or "domino" effect of an overall slowdown. Supplier companies get hit right after their customers do and it continues on down the supply chain.

Iron ore is the primary component in steel manufacture - steel is used in cars for example and a drop in car sales results in lower demand for steel.... so not only does the iron ore number go down, but all of the other "ingredients" for steel like raw coke, energy and labor.

[mriddick]

I'm not a salesman, I manage the account at the customers location. I'm more on the technical end of business, hopefully we have sales guys doing as you suggested.

[Warthogg]

While it probably isn't good I wouldn't worry too much. After all more stuff is shipped before the holidays and then after you would expect a decline.

I believe your point would affect the HARPEX - container shipments...basically finished goods - but not the Baltic Dry as I'm thinking not even the weevil was bad enough to get a load of iron ore for Christmas !!


Wart