The Baltic Dry Index (BDIY) – which tracks the movement of the average prices of shipping goods by sea – has seen a revival in the last month. The index had slumped 67.8% since the beginning of the year, recording a low of 723 points on 22 July. It has since made a comeback, however, having sharply risen to 1,040 points – up 38.3% since the start of August.

Iron ore producers blamed unfavorable weather for the lower production in the initial months of the year, which caused a drop in the demand for shipping. The decreased demand compelled shipping companies to operate at lower capacity (running their ships half-empty at times), which resulted in lower revenue per voyage.

The revival of the Index is a testament to the strengthening global economy, with increasing prices the result of greater demand for shipping in the last month. Analysts believe that the shipping price increase is largely driven by iron ore shipments.

The three companies that dominate the global production of iron ore – Rio Tinto plc (RIO), BHP Billiton Limited (BHP) and Vale SA (VALE) – announced an increase in iron ore production in their second-quarter operational reviews.

BHP Billiton said second-quarter iron ore production was 56,643 kt, 19% more than production at the same time last year, and 15% higher than in its first fiscal quarter.

Rio Tinto produced 73.1 mt of iron ore, 11% greater than the same quarter last year, and 10% higher than the preceding quarter.

Vale produced 79,448 kt of iron ore, 12.6% higher than the second quarter last year, and 11.8% greater than the previous quarter.

Dry Ships Inc. (DRYS) and Navios Maritime Holdings Inc. (NM) are the largest players in the global shipping industry, and the movement in the stocks has largely followed the Baltic Dry Index’s trajectory.

Dry Ship stock declined 33% January-July, but gained 14% in August. Navios Maritime stock was down by around 25% in the same period, but has also surged back in August, rising 14.8%.