SB

Transport Trackers came out with a research note in regards to the BDI's recent ascent to 4,000. Predicting the BDI is a bit of a fool's game, and they do not try to do so. Yet they still make it clear that betting on the BDI beyond 4,000 is pure speculation since dry bulk vessel oversupply risks continue. Can it break 4,000? Sure, especially given that it's an index of spot rates as we have previously explained. But Transport Trackers' ex-Citi Head of Asia Transport Charles de Trenck recommends that prudent capital refrain from further BDI upside speculation. The recent 6.9% one-day drop shows just how quickly this index can turn.

Look at Supply: In 2H09 and into 2010 vessel supply, regardless of delays and cancelation discussion/debates, should bring back concerns of too many bulk ships. We are not against looking at certain long‐term contracts backed by cargo. But from this point on in current cycle, we are against blind speculation on BDI moving above the 4000 level.