Diana Shipping Inc. (NYSE:DSX) owns and operates 18 dry bulk shipping vessels with a capacity of over 2 million deadweight tons. Diana's fleet is one of the newest in the world, being over nine years younger than the average merchant fleet. The company earns its revenues by chartering its vessels to other companies for periods of two to five years for a fixed daily fee. The chartering of these vessels involves the delivery of commodities like iron ore and wheat throughout the world. shipping rates have exploded between 2006 and 2008, causing Diana's net income to rise over 120%. Unfortunately, the 2008 Financial Crisis and the ensuing global economic downturn has caused rates to plummet. Prices to ship dry goods felly by 90% in 2008, and have remained low throughout 2009.
Slowing growth in China has damped demand for raw materials. Smaller demand for raw materials means there's less demand for manufactured goods, both of which mean there's fewer things that need to be transported to and from China. Nearly all of Diana's contracts were negotiated before the fall, but by 2009 half of them expired and came up for renegotiation, at which time the company's margins decreased.(Read more at Wikinvest )