Beware of what is coming

The Baltic Dry Shipping Index tracks the rates charged to ship dry commodities (coal, wheat, copper, lumber, etc.). That index has dropped to its lowest level in three years, which shows a slump in cargo shipments. Source: CBC/Radio-Canada

While the Baltic Dry Index is obscure to your average retail investor, keen market watchers have long considered it a valuable leading indicator for the world economy, indicating shifting tides in demand for key industrial commodities. And its plunge comes at a time when the prices for many key commodities remain buoyant – a disconnect that would traditionally suggest that commodities are poised for a fall.