Price and price indices in maritime transport services: A research on dry bulk shipping and applications in Turkey

Dry bulk shipping is the main form of transport for world's most important raw materials and manufacturing goods. The seaborne trade and thus, the dry bulk shipping is highly sensitive to various number of factors. Fluctuations in global economy, global trade, oil prices, political conflicts, all have direct effects to the shipping industry as a whole. In such a volatile and sensitive industry, with high costs of investment and operation, it is important to know, to what and how much one is exposed to. In order to guide the actors of this industry, freight indices come in to play. Freight indices aim to shed light on the current situation of the market and provide guidance for what might happen in the future. With the contribution of experienced shipbrokers, freight indices report daily fixtures, compose data gathered from various routes and different size of vessels to provide useful information for both shipowners and charterers. The purpose of this study is to determine the factors that have an impact on freight rates in dry bulk shipping and analyze the freight indices, investigate its applications in Turkey, gauge the perception of said applications among Turkish shipbrokers and provide a way to forecast future freight rates in the dry bulk shipping market. This study is hoped to contribute to the actors of both the actors in Turkish dry bulk transportation by providing them with a tool to forecast freight rates and to the producer of the freight indices by determining the perception of Turkish shipbrokers towards the usage of and expectations from freight indices. Keywords: Price, Price indices, Freight, Dry bulk, Freight indices, Forecast