Drewry Shipping Consultants and Cleartrade Exchange will launch a Europe-based container index in September, providing weekly freight rates that shippers can use to hedge against future risk, though top companies will likely not participate, Reuters reports. Maersk Line (MAERSKb.CO: Quote), the world' top container firm, and other leading shipping companies have openly opposed the expansion of the container freight futures market, saying it creates more uncertainty and does not accurately reflect rates.
The World Container index, which will be available to some shipping companies a few weeks before the official launch, will consist of 11 major route-specific indices including Shanghai to Rotterdam and Shanghai to Los Angeles.
"Significantly, the new index will be the first of its kind to report weekly freight rates on backhaul as well as headhaul routes and will provide increased efficiencies in hedging strategies for freight users," said Richard Heath of the World Container Index.
Contracts will be available with at least one clearing house near the launch date and subscriptions will commence from Aug. 22, he said.
Most derivatives are currently settled against the Shanghai Containerised Freight Index (SCFI), which is compiled by data provider the Shanghai Shipping Exchange.
Freight derivatives allow a buyer to take a position on where freight rates will stand at a point in the future. Container contracts offer the same hedging principle as those traded for dry bulk and tanker markets.
The World Container index, which will be available to some shipping companies a few weeks before the official launch, will consist of 11 major route-specific indices including Shanghai to Rotterdam and Shanghai to Los Angeles.
"Significantly, the new index will be the first of its kind to report weekly freight rates on backhaul as well as headhaul routes and will provide increased efficiencies in hedging strategies for freight users," said Richard Heath of the World Container Index.
Contracts will be available with at least one clearing house near the launch date and subscriptions will commence from Aug. 22, he said.
Most derivatives are currently settled against the Shanghai Containerised Freight Index (SCFI), which is compiled by data provider the Shanghai Shipping Exchange.
Freight derivatives allow a buyer to take a position on where freight rates will stand at a point in the future. Container contracts offer the same hedging principle as those traded for dry bulk and tanker markets.