Iron Ore prices dancing with Shipping Rates

2 years ago I posted this note studying Iron Prices when compared to the Baltic Dry (shipping) Index.

Today, the Baltic Dry Index (BDI) is trading at an overbought extreme.

The Singapore 62% Iron Ore price hit that same overbought metric 2 weeks ago .

Here is a chart of the BDI laid over the Iron Ore.

In the original Dec 2021 note, I said, ‘look out below’ suggesting the Baltic Dry Index could visit $900. The circle denotes a moment when it traded to $970 and it eventually made it to $530.

Now, I expect a pullback in the Baltic Dry Index and the price action in Iron Ore related stocks isn’t particularly constructive.

October 3, 2023

by Rob Zdravevski

rob@karriasset.com.au