What is Baltic Freight Index?
Baltic Freight Index stands for shipping and trade index which has been created by the Baltic Exchange based in London. It is a measure of the cost of transporting various raw materials. The Baltic Exchange contacts the shipping brokers directly for assessing price levels for a specific route, product, time and speed.
The Baltic Freight Index is thus a combination of three sub-indices which seek to measure different sizes of merchant ships or dry bulk carriers, namely,
- Capesize: these are the largest among all three in the BFI with the deadweight tonnage (DWT) of 100,000 or more. They basically transport coal and iron ore.
- Panamax: these are second in number and have a DWT of 60,000 to 80,000. They are used to transport coal, grains, sugar, cement etc.
- Supramax: these are the smallest of all the ships with a capacity below 59,999 DWT. These have special loading and unloading equipment.