History - 1873 - 1914
The late 19th century was a period of unparalleled prosperity for Great Britain. It controlled nearly a third of all global industrial output, with its nearest rival the USA lagging far behind. Britain's trade was worth double that of France and the amount of shipping organised by members of the Baltic was proportionately enormous. It was around this period that the telephone made its first appearance and the Edison Telephone Company which first installed telephones at the Baltic. By 1881 calls to and from South Sea House numbered 200 a day.
As membership of the Baltic grew arguments broke out between the shareholders and the members as to the quality and quantity of services provided and a rival organisation - the London Shipping Exchange - opened at 19 Billiter Street in March 1892. Two leading Baltic members joined its board of directors and by 1896 boasted around 1,600 members. However, the Baltic at South Sea House still maintained its pre-eminence which the London Shipping Exchange was desperate to emulate. Two competing exchanges with a shared membership was clearly not in the best interests of the market and by 1898 moves began to merge the two institutions. The lease on South Sea House was due to run out in 1900 and the City of London Exchange Company was formed to purchase a new site and create a new exchange in Jeffrey Square (now St Mary Axe) and in 1900 a new company - the Baltic Mercantile and Shipping Exchange Limited - was incorporated.
By 1902 the London Shipping Exchange, the Baltic Company Ltd and the City of London Exchange Syndicate Ltd merged and moved to the grand new building built in St Mary Axe following a short spell at the Great Eastern Hotel at Liverpool Street.
St Mary Axe building
The 1903 Baltic Exchange was one of the City's grandest trading halls. The building was designed by T. H. Smith and W. Wimble and saw trading on a daily basis. Shipbrokers, owners and charterers representatives would gather to share information and to physically transact the deals. Up until 1920s the Baltic was primarily a grain exchange with up to 250,000 tonnes of grain bought and sold on its trading floor everyday.
By attending the Baltic the brokers not only learnt what the shippers were offering - the types of grain and the periods of shipment, but also obtained concessions on price and terms which neither buyer nor seller could manage if they met face to face. In the course of a series of conversations on the trading floor, a chartering clerk obtained a firm offer of a vessel and a firm bid for the carriage of the cargo much more easily and swiftly than was possible by telephone, telegram or letter.
The heads of all the firms, big and small, walked the trading floor every day and stayed for lunch. Amid the hustle and bustle, brokers would queue for the telephones and strain to make themselves heard above the din of business chatter.