Baltic Exchange, Freightos set up freight index for spot rates

  May 2--THE Baltic Exchange and Freightos have created the Freightos International Freight Index to track the trades between China and East Asia and the US east and west coasts, Europe, the Mediterranean, and South America's east and west coasts.

  The index will reflect weekly spot rates for 40-foot containers based on 12 million to 18 million price points collected every week on a dozen main shipping trade lanes. The rates will be audited by the Baltic Exchange and republished as the Freightos Baltic Indices, reported American Shipper.

  The companies will also create a weighted average of the 12 underlying route indexes to be called the FBX Global Container Index (FBX) that they said is "setting the stage for derivative financial instruments in the future."

  The Baltic Exchange already provides daily assessments for the dry bulk, tanker and gas freight markets that are used widely in shipping markets and to settle forward freight agreements (FFAs). The Baltic Exchange, which is headquartered in London and traces its roots back to 1744, was acquired by the Singapore Exchange in 2016.

  Baltic Exchange chief executive Mark Jackson said: "By offering our robust auditing methodology to the FBX we hope to provide the framework for the container shipping industry to develop sophisticated risk management tools."

  Freightos CEO Zvi Schreiber added that his company's technology and database of multi-modal freight rates have "already power both market intelligence and real-time freight booking and management for over 1,000 carriers and forwarders, as well as over 3,000 shippers."

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