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Coronavirus restrictions hit shipping, spreading global economic strain

February 23, 2020 / BENOIT PELEGRIN
SHARESHARESHARE

Sea freight transport, the lifeblood of trade and a bellwether of the global economy, has been blown off course by the new coronavirus, sparking general alarm. As analysts pore over charts to gauge just how badly Chinese mega-factories have been hit, figures provided by cargo ship traffic paint a gloomy picture. The Baltic Dry Index (BDI) reflects the daily price of moving goods such as coal, rice and wheat along routes deemed representative of the global market. Some call it the canary in the coal mine for the economic world. The BDI has now reached lows last seen in early 2016, when the shipping sector was suffering a supply and demand imbalance in the wake of the 2008-09 global economic crisis. Its “Capesize” index for the largest category of ships — those that cannot even squeeze through the Suez or Panama Canals — is at historic lows.