Shipping Index

The Track.com Shipping Index

The state of the shipping sector can be a good leading indicator of growth in the global economy. A couple reasons why:

First, manufacturing requires basic raw materials and energy (e.g. petroleum or crude). Both of these need to be shipped from the start of the supply chain to the location of the manufacturing process. Thus, an increase in shipments of raw materials today signals a potential increase in activity along the supply chain tomorrow.
Second, building and disposing of shipping vessels is both time-consuming and costly. When the sector finds itself with excess shipping capacity, shipping rates will drop as firms are unable to dispose of their excess quickly. Inversely, when the sector is at or above capacity, shipping rates rise as firms struggle to add capacity to their fleet. Observing these fluctuations in capacity can be a good way of predicting the global consumer appetite

By focusing on a limited number of companies operating within both the dry and liquid bulk shipping markets and on shipping along global routes, Track Research, LLC has built a simple to understand model that we expect will be effective at predicting growth trends in the global economy.