Interconnected freight markets: An ensemble learning and GAM approach to regional and international dry bulk shipping rates

The Baltic Dry Index (BDI) is widely regarded as a key generalizing indicator of shipping market conditions, supporting the analysis of historical market developments, the identification of current trends, and the forecasting of future market trajectories. Despite the index's widely acknowledged utility, it has historically paid limited attention to regional specificity. Consequently, the precise nature of its interconnections with fast-evolving regional freight markets remains insufficiently explained. Addressing this limitation, this study introduces a novel approach that integrates ensemble learning techniques with a Generalized Additive Model (GAM) to examine the complex relationships between regional and international freight rate indices, alongside macroeconomic and industry-specific variables. Using 14 variables from the Black Sea and Mediterranean regions over 413 weekly observations (2016–2024), the analysis identifies a triadic interaction pattern among freight indices that significantly shapes global shipping dynamics. Results indicate that regional indices not only respond to international market conditions but also exert measurable influence on global freight benchmarks, challenging the traditional assumption of unidirectional causality. The proposed triadic interaction framework sets a new perspective for shipping markets and enables more accurate regional forecasting. Specifically, the findings demonstrate how regional markets can influence global freight movements through interconnected spillover mechanisms. Shipowners and charterers should integrate region-specific indices into their risk assessment frameworks to better tailor hedging and operational strategies for target regions, moving beyond sole reliance on the generalized BDI.