Does shipping market affect international iron ore trade?– An equilibrium analysis

Yang, Dong; Zhang, Lingge; Luo, Meifeng; Li, Feng

doi:10.1016/j.tre.2020.102107

Cited by 16 publications

(5 citation statements)

References 60 publications

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“…While evidence have already shown that there is a relationship between commodity prices and freight rates (Gu et al 2019;Yang et al 2020), the conundrum between the positive or the negative effect that commodity prices have on shipping companies profitability remains to be answered. Although, some studies suggest that the rising price of commodities will positively affect the profitability of companies , others suggest that the relationship between iron prices and bulk freight rates is negative (Lim 2021).…”

Section: Literature Reviewmentioning

confidence: 99%

Can commodity prices predict stock market returns? The case of dry bulk shipping companies

Melas,

Michail

2024

J. shipp. trd.

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We explore the relationship between the returns of 45 dry bulk shipping company stock prices and the main 15 commodities that bulk carriers transport. Using a principal component analysis to reduce the dimensionality of the commodities dataset and a panel methodology, we find that a change in the commodity price principal component would result in a 0.6% change in the returns of the shipping stock prices. Minerals appear to have a stronger impact, as a 1% change in the minerals principal component results in a 1.1% change in the returns. This is mainly due to the fact that minerals account for larger trade volumes in the dry bulk market and they employ mostly bigger vessels, while the price of Brent oil is also an important factor affecting shipping stock prices.

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Section: Literature Reviewmentioning

confidence: 99%

Can commodity prices predict stock market returns? The case of dry bulk shipping companies

Melas,

Michail

2024

J. shipp. trd.

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“…Unexpectedly, such studies have seldom analyzed the trade patterns of competitiveness and complementarity, which are defined as rivalry and collaboration, respectively, in terms of benefits from trade economic activity (Anna and Agnieszka 2016) and are essential for investigating trading activities (Thissen, Graaff, and Oort 2016). Regarding competitiveness and complementarity analysis, strategic resources for national development, such as liquefied natural gas (Chen et al 2016), iron ore (Yang et al 2020) and agricultural products (Simo, Mura, and Buleca 2016), are mainly considered. Regarding the research approach, several useful indicators for identifying intercountry competitiveness and complementarity, such as the revealed comparative advantage (RCA) index (Liesner 1958), the export similarity index (ESI) (Glick, Rose, and Rose 1999), and the trade complementarity index (TCI) (Kojima 1964), have been adopted in many studies, which concentrate mainly on the analysis of competition and seldom focus on the complementary relationships among countries.…”

Section: Literature Reviewmentioning

confidence: 99%

Manufacturing diffusion trends from the perspective of trade network: the belt vs. the road

Niu

Liao

et al. 2022

Maritime Policy & Management

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With the deepening of the 'Belt and Road (B&R)' initiative (BRI), the trends of manufacturing relocation and diffusion along the B&R has accelerated. This paper first collects bilateral trade data of 16 categories of major commodities among 55 countries along the B&R for 2017. Second, according to current and future transportation accessibility, this paper constructs two types of topological networks among countries along the B&R from the perspectives of both competitive and complementary trade. Percolation theory is adopted to analyze the manufacturing diffusion trends and bottleneck links among the two types of topological trade networks, which provides a new perspective through which to study manufacturing relocation and diffusion patterns. The results show that (1) based on current transportation accessibility, main industries percolate and agglomerate among countries with rapid economic development along the 21st Century Maritime Silk Road and that (2) the improvement in the China-Europe Railway Express (CR Express) postpones diffusion trends and improves the relocation potential of Silk Road Economic Belt regions.

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“…Lastly, commodity prices and shipping costs significantly impact maritime transportation volumes (Maxwell and Zhu, 2011;Ji et al, 2018;Bai and Lam, 2019;Brancaccio et al, 2020;Yang et al, 2020). Ji et al (2018) developed a VECM study and found that high LNG import prices of China locked by long-term contracts hinder its coal-to-gas transition.…”

Section: Current State Of the Art: Energy Strategies And Impacts On Maritime Transportationmentioning

confidence: 99%

“…Bai and Lam (2019) studied, in very large gas carrier (VLGC) market, how freight rates influence shipping demand using structural equation modelling. Yang et al (2020) built a mixed complementarity-based equilibrium model, depicting interactions between iron ore shipping costs and trade volumes.…”

Section: Current State Of the Art: Energy Strategies And Impacts On Maritime Transportationmentioning

confidence: 99%

“…Hence, decision-making of energy companies can be complicated, which currently focused more on building up reliable and adequate supplies than profitability and diversification (Leung, 2011;Ji et al, 2018). As such, it could be challenging to analyse oil and gas strategies of China based on subjective assumptions set by modellers in SD (Pan et al, 2017) or mixed complementarity-based models (Egging et al, 2010;Yang et al, 2020) as defining scenarios and optimal solutions can be difficult. The two most recent and relevant studies on energy strategies of China both adopted VECM models (Wang and Lin, 2014;Ji et al, 2018), which are stochastic process models that reflect linear interdependencies among non-stationary time-series variables, in which impulse-response patterns are assessed based on empirical patterns found in historical data (Granger and Newbold, 1974).…”

Section: Current State Of the Art: Energy Strategies And Impacts On Maritime Transportationmentioning

confidence: 99%

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Energy strategies of China and their impacts on energy shipping import through the Straits of Malacca and Singapore

Yin

Lam

2021

MABR

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PurposeThis study aims at investigating how energy strategies of China impact its energy shipping import through a strategic maritime link, the Straits of Malacca and Singapore (SOMS).Design/methodology/approachVector error-correction modelling (VECM) is applied to examine the key energy strategies of China influencing crude oil and liquefied natural gas (LNG) shipping import via the SOMS. Strategies investigated include oil storage expansions, government-setting targets to motivate domestic gas production, pipeline projects to diversify natural gas import routes and commercial strategies to ensure oil and gas accessibility and cost-effectiveness.FindingsFor the crude oil sector, building up oil storage and diversifying oil import means, routes and sources were found effective to mitigate impacts of consumption surges and price shocks. For the LNG sector, domestic production expansion effectively reduces LNG import. However, pipeline gas import growth is inefficient to relieve LNG shipping import dependency. Furthermore, energy companies have limited flexibility to adjust LNG shipping import volumes via the SOMS even under increased import prices and transport costs.Practical implicationsAs the natural gas demand of China continues expanding, utilisation rates of existing pipeline networks need to be enhanced. Besides, domestic production expansion and diversification of LNG import sources and means are crucial.Originality/valueThis study is among the first in the literature using a quantitative approach to investigate how energy strategies implemented in a nation impact its energy shipping volumes via the SOMS, which is one of the most important maritime links that support 40% of the global trades.

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Does shipping market affect international iron ore trade?– An equilibrium analysis

Cited by 16 publications

References 60 publications

Can commodity prices predict stock market returns? The case of dry bulk shipping companies

Can commodity prices predict stock market returns? The case of dry bulk shipping companies

Manufacturing diffusion trends from the perspective of trade network: the belt vs. the road

Energy strategies of China and their impacts on energy shipping import through the Straits of Malacca and Singapore

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