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Shipping indicators signal improvement in supply chains
The Baltic Dry Index has fallen to a level last seen in early June, reflecting improvements in global supply chains.
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Vehicles travel down Jl. Pak Kasih at the Pelindo II-operated Dwikora river port on the Kapuas River in Pontianak, West Kalimantan, on Friday. The port, located 17 miles from high seas, has a limited capacity, hampering exports of commodities such as crude palm oil. (The Jakarta Post/Severianus Endi)
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hipping indicators are showing early signs of improvement in global supply chains after rising demand on the back of economic recovery this year caused logistical issues that have sent prices up.
The Baltic Dry Index reached a reading of 2,678 on Nov. 25, a level last seen in early June. It peaked at 5,650 in early October before going down.
The index published by London-based maritime organization Baltic Exchange gauges the cost of transporting raw materials on more than 20 representative routes, including via Indonesia.
Andry Satrio, an economist at the Institute of Development for Economics and Finance (Indef), said the fall in the index reflected a decrease in the cost of transporting raw materials, especially coal, iron and steel.
“It is a sign of improvement on the [supply side],” Andry told The Jakarta Post in a voice message on Monday.
Disruption of supply chains, a spike in energy prices and pent-up demand during the global recovery created a perfect storm that saw prices of commodities, such as coal, to skyrocket.
