DHL in conjunction with Accenture has unveiled the DHL Global Trade Barometer, a new early indicator for the current state and future development of global trade based on large amounts of logistics data that are evaluated with the help of artificial intelligence. The global logistics giant noted that that trade indicator not only provides an outlook on future trade, but also on the prospects for the global economy. The indicator has been developed in cooperation between DHL and Accenture and will be published quarterly.
The January barometer reading indicates that global trade will continue to grow over the next three months. On its initial release, the index scored 64, which is slightly below the values calculated for previous months.
That means that world trade is still considered to be in an expansive mode, but growth loses momentum. The decline is due to weakening prospects for Chinese and Japanese trade, which is only partially offset by improved prospects for India, South Korea and Great Britain, DHL said.
“As the world’s leading logistics provider, DHL has both, a deep understanding of the driving forces behind global trade volumes and the industry expertise to analyze and interpret market data. Our network, knowledge and experience uniquely position us to understand global supply chains in order to derive a global trade outlook,” said Tim Scharwath, CEO of DHL Global Forwarding, Freight. “The DHL Global Trade Barometer shows impressively how digitalisation – with the use of Big Data and Predictive Analytics – opens up entirely new opportunities that we can use for the benefit of our customers.”
Accenture will provide data modeling and predictive analytics to forecast future trade trends for DHL. DHL will receive one unified view of the insights which will give them a stronger understanding of current and future state of global trade logistics for its customers.
The DHL Global Trade Barometer is based on import and export data for a number of intermediate and early-cycle commodities that serve as the basis for further industrial production, e.g. brand labels for clothes, bumpers for cars or touch screens for mobile devices. Sources for the index are aggregated market data from air and containerised ocean freight in seven countries, which account for more than 75 per cent of world trade. Using artificial intelligence and various statistical methods this data is compressed to a single index value, which is published on a global level and individually for the seven countries evaluated.
The DHL Global Trade Barometer index represents the weighted average of the current growth and the upcoming two months of global trade. An index value above 50 indicates a positive development; values below 50 point to a decline in world trade. Tests with historical data have revealed a high correlation between the DHL Global Trade Barometer and real containerised trade, providing a three-month forward-looking estimate.
In addition to the findings on world trade in general, the DHL Global Trade Barometer provides deep insights into specific issues, e.g. the main macroeconomic factors that are affecting trade trends or the countries and regions that are driving global trade. By breaking down the global supply chain, volume trends within industry sectors could be identified, pointing to outperforming and declining sectors.
The insights from the DHL Global Trade Barometer will help DHL customers to optimise their business processes, for example providing guidance for investment and supply chain decisions. Moreover, DHL itself will leverage the indicator to fine-tune its own resource planning for its international logistics operations.
Due to the high quality of the data, the company believes that the DHL Global Trade Barometer has a high significance also beyond logistics. Since it is an indicator for future trade and economic growth worldwide, the index could be integrated into forecast models by banks, associations or economic research institutes.
“In a world characterised by volatility and uncertainty, we are contributing to greater transparency and predictability – for the benefit of our customers, our business and society,” Scharwath added.