Long Term Freight Market Index and Inferences *

This paper proposes to establish a long term shipping freight index for dry cargo transportation and investigates its particulars among the cyclic fluctuations. Many scholars investigated dry cargo shipping markets and some of them attempted to construct a composite index of freight rates. Although, several critiques are indicated about the method of composition, these indices depicted long term movements in general. This paper also presents models for long term freight rates and seaborne trade with the recent data. A novel contribution is derived from using life expectancy as a long-run leading indicator.