Voyage for nothing and Ships for free

Dry Index dropped for the 33rd consecutive trading session to register a 14-month low of 1,790.

Notwithstanding the increasing number of empty houses and apartments in China, real estate market has swelled out of proportion in China (and India too). Chinese Govt. has taken many steps in the past few months to limit the bubble and is now assessing national financial risks, which arise out of price distortion, misallocation of resources, debts pumped into speculative bubble and mindless squandering of wealth due to current state of exaggerated prosperity. Besides property, manipulation of Yuan is becoming more and more difficult for China.

Similarly, the current austerity drive in European countries, is adding up to the vows of shipowners. However, UK is now thinking of shifting focus to manufacturing rather than services to boost their exports in order to arrest the trade deficit at large.

In addition, this year the sanctions imposed on trade with Iran have become more stringent and tighter than ever. This will have a direct and immediate impact on world shipping, which was already sailing on the razor's edge. The situation is more precarious than it was in 2008, with austerity and sanctions in, and bailout and stimulus out.

Effect is immediately visible in the freight markets, as due to decreasing raw imports, the commodity and freight rates, both have dropped considerably in 'circular causality paradox' over the last one month. Another impact of the commodity price fall is the sell-off of the high sea storage, thereby release of the shipping units on storage duty and their return in the employment market. Besides, a large number of new buildings will be adding upto the number of empty bottoms over the next two years. It has to be seen, how much contraction can this market take, before it refuses to yield further and we see a flurry of layups - hot and cold.

On the whole, a long drawn sob story on the blue sea screen.