Most of us go about our daily routines without ever stopping to consider how the products that we depend on every day make it to our cities and homes.

From the food that lines our pantry to the cement that builds our roads to the gas that runs our cars, all goods have to get from point 'A' to point 'B' -- whether by land, air, or sea. The bulk shipping industry presents several stocks that may make investors think twice about where all of those products come from.

Most shippers are categorized according to what type of goods they transport. One of the first groups that springs to mind is the Supertankers, which typically carry in excess of 250,000 tons of crude oil. However, there are also shippers that carry cargo such as grain, iron ore, coal, forest products, and cement -- the so-called "dry bulk" shippers. These types of ships handle more than one-third of the world's ocean-based trade.

Until recently, dry bulk shipping has long been considered a quiet, mature business -- well off most investors' radar screens. In fact, during the 1990's, total industry shipping volumes increased at just +2% per year.

However, that began to change around the late 1990's and early 2000's, as booming economic expansion in China and other explosive markets caused demand for shipping space to skyrocket. From 1999 to 2004, the annual growth in total amount of dry bulk goods shipped -- which is measured in tonnage -- increased by a full +25%. And with limited fleet capacity available, the Baltic Dry Index (a proxy for shipping rates) surged.

Not surprisingly, stocks in the shipping industry followed suit -- with some racking up tremendous gains of +400%, +500%, or more. They have since come down to more reasonable levels, however.

Here's a quick look at some of the leading players in the dry bulk shipping industry:

There are several factors that lead us to believe the bulk shipping industry is attractive:

Supply:

• A significant percentage of the world's shipping fleet was built in the 1980's. Most of these ships are now reaching an age where they will need to be taken out of service and replaced.
• Shipbuilders make more money constructing oil tankers and containerships, so there is less capacity available to build dry-bulk vessels.

Demand:

• The Chinese economy is growing at a torrid pace, and the country is busily importing incredible amounts of raw materials for highways, bridges, and other infrastructure projects.
• The recent surge in oil and natural gas prices has helped lift the price (and thus the shipping costs) of coal -- which accounts for more than one-fourth of the average dry bulk shippers' freight.

To be sure, there are a number of ships on order and the global fleet will expand modestly. However, these ships cannot be built overnight, and increased demand should be more than enough to soak up this extra fleet capacity.

It is worth emphasizing that the dry-bulk shipping industry is tied directly to the health of the Chinese economy -- so any problems there could trigger a sharp selloff. However, we foresee no such slowdown and believe that China will continue to keep shippers busy for years to come.

For those that want a conservative way to cash in on this growth, the cargo shipping industry could be the perfect solution.

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