Effects of Developments in Maritime Transportation on Production Sector Companies

The Baltic Dry Index (BDI) is one of the most important economic indicators that reflects the dynamics of international trade and the global shipping industry. Changes in the index provide information about the changes that may occur in the costs and profitability of the companies through the signals that give about trends in the global economy. Therefore, monitoring the changes in the BDI is of great importance, especially for companies operating in the manufacturing sector. In this context, the aim of the study is to determine relationships between the BDI and the production-based sector indices in Borsa Istanbul in the context of the time dimension. For this purpose, the relationships between the BDI and 22 sector indices were analyzed by the frequency causality test of Breitung and Candelon (2006). The most important finding of the study is that many of the sector indices are related to the BDI. Another important finding of the study is that the relationships change in different time periods, such as short-term and long-term. The findings indicate that companies operating in the manufacturing sector and investors willing to invest in the manufacturing sector should make their decisions by taking into account the effects of fluctuations in maritime transportation on the sector.