Ocean Freight Opened 2005 Easier

ROME - Apr 7/05 - SNS -- International ocean freight rate levels opened 2005 on an easier note, with rates for most vessel types dropping below their November and December highs, according to comments from the International Grains Council (IGC) contained in this month's food outlook report from the UN's Food and Agriculture Organization.

"Dry bulk freight rates continued to rise in November due to sustained Asian demand for minerals and grains," the IGC wrote. "A seasonal increase in grain and soybeans shipments, especially in the northern hemisphere, together with the weakness of the US dollar, further contributed to the advance.

"By early December 2004, the Baltic Dry Index (BDI) had surged to a new record of 6200, surpassing the February 2004 peak. However, rates then fell back heavily on lower than previously expected Chinese demand, congestion in Asian ports and weaker crude oil prices," the IGC said.

"As a result, the BDI lost 30 percent in December - January, dropping to 4307. After the Lunar New Year holidays, the market strengthened again on renewed Asian demand and good export prospects for the new South American grains and soybeans crops. By the end of February the BDI had recovered to 4878."

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