Shipping companies surge as Baltic Index hits 21-month high

MUMBAI: Shares of sailing companies were sailing smooth after the dry Baltic Index, a benchmark rate for transporting commodities across seas, surged to 21-month high to 2,127 points, up 106 points or 5.24 per cent against its previous close.

At 02:45 p.m.; Shipping Corporation of India was up 12.18 per cent, Mercator rallied 13.43 per cent, Varun Shipping surged 19.89 per cent, GE Shipping gained 8.87 per cent and Bharati Shipyard surged 19.96 per cent.

The jump in the index is good for shipping companies as it shows increased demand for cargo carriers. The Baltic Index has been hovering near 1,100 for the last 3-4 months.

According to reports, the surge in he Baltic Dry Index has been mainly on account of rise in rates for transportation of iron ore-carrying Capesizes due to imports from China.

Higher rates are expected to improve Indian shipping companies’ revenues, margins and cash flows.