Premium
Coping with International Freight Rate Volatility
Author(s) -
Thuong Le T.,
Ho Christina
Publication year - 1987
Publication title -
journal of purchasing and materials management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 3.75
H-Index - 92
eISSN - 1745-493X
pISSN - 0094-8594
DOI - 10.1111/j.1745-493x.1987.tb00189.x
Subject(s) - futures contract , business , volatility (finance) , futures market , hedge , consignment , charter , finance , marketing , history , ecology , archaeology , biology
A major problem confronting bulk‐cargo shippers is the volatility of charter rates. With the recent availability of freight rate futures, logistics and materials managers can now hedge against such risks in international shipping. The freight rate futures market became operational on May 1, 1985. Through use of the futures market, cargo owners and ship charterers can reduce freight risks, and importers and exporters can conduct their business with the expectation of more stable freight rates.