The rapid growth of China's economy has not only dramatically changed the international logistics environments but has also greatly influenced the world shipping market. The so-called China effect made the ocean freight soar to an unprecedented level despite the terror of September 11, the resulting war in Afghanistan and Iraq and worldwide recession. The main purpose of this paper is to analyse the characteristics of the China effect in dry bulk market and show how long the effect lasts. This paper employs GPH co-integration test since the structural model must be stationary to get the accurate predicted values. The empirical results show that the model is mean-reverting. This paper also applies variance decompositions and impulse-response functions to the structural model, indicating that freights are endogenous to the trade variable. The rolling regression coefficients and impulse-response functions suggest that the China effect decays very slowly and lasts long.