Baltic dry sea freight index smashes record -- again

LONDON, Sept 27 (Reuters) - The Baltic Exchange's dry freight Index .BADI, which gauges the strength of seaborne dry commodities trade, hit a new high on Thursday, continuing its record-breaking trend of recent months.

The London Baltic Exchange's chief price index, which monitors major trade routes for coal, iron ore, cement and soft commodities like grains and sugar, climbed 111 points to 9,370 after breaking through the 9,000 barrier on Monday.

It means the index has now risen almost 2,000 points in a month, breaking records almost daily along the way, fuelled by strong demand for raw materials across the board.

"All the vessel sizes are at very high levels," said Peter Norfolk, a senior analyst at Simpson, Spence & Young.

Ocean freight costs, which experts say directly reflect global demand, have blazed to fresh highs despite turmoil in financial markets and record oil prices.

The index, closely watched by economists, began breaking records in May this year, driven by huge demand for natural resources in China and India and a lack of ships.

Norfolk said steel prices were very high and spot prices for iron ore out of India were at record levels, more than double than from the start of the year and climbing weekly.

"The price of U.S. soy and U.S. wheat are very high, and coal prices are very firm as well," he said.

"Demand for all those major commodity types is extremely strong at the moment."