The Baltic Dry Index has rebounded over 60% from its 2023 lows, signaling a significant upswing in global dry bulk freight rates. This rally underscores strengthening demand for transporting key commodities like iron ore, coal and grain across major trade routes.

The Breakwave Dry Bulk Shipping ETF has climbed more than 35% year to date, providing investors direct exposure to freight rate movements without company-specific credit risk. Its performance highlights the leverage inherent in sector-wide shipping rate trends.

Dry bulk vessel ordering remains near multi-decade lows at roughly 7% of the existing fleet, held back by high shipbuilding costs, stricter environmental rules and limited yard capacity. With fleet growth projected below 3% annually through 2027, new tonnage will struggle to meet rising demand.

Global merchandise trade volumes are set to recover in 2026, driven by resurging industrial activity and infrastructure projects. Shipping stocks often lead economic cycles, suggesting further upside potential if demand remains firm and supply remains constrained.