Demand has been driven by demand for iron ore in China after lockdown and opening up , which will drive the momentum forward in the coming months with strong steel production as their iron ore inventories being quite low (10 year lows). The Baltic dry index shows strong rebound since mid May. As we all know China is globally the largest importer of dry bulk commodities; imports 35% of global dry bulk commodities and imports 70% of total iron ore cargoes. China has announced a major stimulus package with a massive infrastructure spending plan to boost their economy of $500Billion.There is a sentiment for a healthier dry bulk shipping for China. As there is an easing of COVID-!( related restrictions , massive global stimulus measures taken, India will slowly open up, being the 2 nd largest producer of steel is aiming at 80%-90% capacity, thus showing freight rates recovering. On top of that there is a slower net fleet growth with the smallest newbuilding order book ; a 20 year low, which will cause demand to outstrip supply from 2021. The immediate issues for shipping remain on the human resource side; crew rotations due to covid-19 and the lack of international recognition that SeaFarers are essential workers. Let us not forget that shipping moves more than 80% of global trade. By Peter Pontikos, Lavinia Corp.
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