History - 1914-1945
The First World War created huge difficulties for an international institution like the Baltic Exchange with its German and Austro-Hungarian members and their clerks banned. 62 Baltic members lost their lives in the war and their sacrifice was commemorated on marble panels unveiled in 1920, to which were added five stained-glass windows as a war memorial in 1922. These windows can now be found at the National Maritime Museum in Greenwich.
The return to peacetime conditions saw the role of the Baltic shifting. The decline of the British Empire and Britain's position on the global stage was reflected by a crisis of confidence at the Baltic Exchange. Members began to ask whether a broker was necessary and a series of conferences with grain merchants, millers and seed crushers and oilseed brokers was called.
By the end of the 1920s not only ships, but also aeroplanes were being chartered to carry goods. In February 1929 S Instone & Company issued Britain's first charter-party. 1929 also saw the introduction of the London Corn Trade Association's futures market at St Mary Axe.
Trade at the Baltic was however declining as the Wall Street Crash of 1929 led to a global economic crisis. Trade patterns altered as governments implemented protectionist policies in the face of the Depression sweeping the industrial world. The earnings of those engaged in shipping slumped as international trade declined and the number of Baltic members dropped.
By 1935 the days of the Baltic as a commodity market were over as the Baltic became a freight market. The brokers had ceased to depend solely on the British merchant navy for their business and fixed cargoes of all nationalities, and from ports in one part of the world to another without touching the British Isles.
1939 saw the outbreak of the Second World War and the government introduced the Ministry of Shipping to organise the chartering of ships and cutting out the Baltic brokers.
After a few weeks of war, Britain began to run short of wheat imports and the government abandoned the system and introduced the direct acquisition of ships. The ministry would instruct the owners to carry certain cargoes and follow certain routes and all chartering was on a time charter basis. The Baltic was forced to suspend its operations and was not back in business until September 1945. The Minsitry of Shipping still retained full control of the direction of voyages, but shipowners and their brokers could arrange chartering and conclude fixtures.