Coal Headlines, Iron Ore Problem

The Baltic Dry Index has dropped for seven consecutive sessions, closing at 2,801 on 13 October 2026 (handybulk.com), down from 2,852 the day before. The Capesize index led the slide, off 3.71% to 3,994. Given two coal stories broke the same week, the temptation is to connect them. Hellenic Shipping News reported on 9 October that seaborne coal volumes fell 6.7% year on year in September, to 115 million tonnes, with thermal coal doing most of the damage. A separate piece on 8 October covered China’s pledge to buy at least 10 million tonnes of US coal annually in 2027 and 2028, part of the tariff deal finalised on 28 September.

Neither explains what’s moving the Baltic this week. Coal doesn’t travel on Capesize vessels in any meaningful volume: it moves on Panamax, Supramax and Handysize tonnage, and those three indices are flat to slightly up (BPI unchanged at 2,432, BSI up 0.66% to 1,833, BHSI up 0.2% to 1,000). If coal demand were dragging the market down, it would show up there first. It isn’t.

The actual mover is the C3 route, Tubarão to Qingdao, the main Capesize iron ore benchmark. It’s down from roughly 37.65 to 33.1, close to 12% in a matter of days, while C5 (West Australia to China) has held flat at 14.15. That points to an iron ore story on the Brazil-China leg specifically, not a broad dry bulk demand problem, and certainly not a coal one.

The China-US coal commitment is a different kind of news entirely. It covers 2027 and 2028, not this quarter, so there’s no reason to expect it in today’s spot numbers. If it shows up anywhere first, it will be in the forward curve, not the Baltic print.