Baltic Dry Index (BDI)
The Baltic Dry Index (BDI) is a benchmark index, published by the Baltic Exchange in London, that tracks the cost of shipping dry-bulk commodities — iron ore, coal, grain and the like — across major sea routes. It is compiled from rate assessments for the main dry-bulk vessel classes (Capesize, Panamax and Supramax), gathered daily from a panel of shipbrokers.
Because dry-bulk demand reflects raw-material and industrial activity, the BDI is widely watched as a real-time, forward-looking barometer of global trade and economic health — rising when demand for shipping raw materials is strong and falling when it weakens. It is also highly volatile, swinging with vessel supply and demand, commodity flows and seasonality. The BDI (and related Baltic indices for other segments) underpins freight-rate negotiation and the freight-derivative (FFA) market. It is one of shipping's most cited numbers and a notable economic indicator beyond the industry itself.
The BDI turns the price of moving the world's raw materials into a single daily number — and because that demand tracks industrial activity, markets watch it as an early read on the global economy. It anchors dry-bulk rate negotiation and the freight-derivatives market, making it one of shipping's most cited and economically significant figures.
What does the Baltic Dry Index measure?
The cost of shipping dry-bulk commodities (iron ore, coal, grain) on major routes, across Capesize, Panamax and Supramax vessels.
Why is the BDI watched as an economic indicator?
Dry-bulk demand reflects raw-material and industrial activity, so the index acts as a forward-looking barometer of global trade.