The launch of its Trucking Freight Futures contracts on March 22 has been announced jointly by Nodal Exchange, a derivatives exchange serving North American commodities markets; FreightWaves, a provider of freight market news, data, and analytics; and DAT Solutions, which is among the largest spot-freight marketplace in North America.
“We are pleased to be able to announce, with FreightWaves and DAT, the successful launch of the world’s first trucking freight futures,” said Paul Cusenza, chairman and CEO of Nodal Exchange and Nodal Clear. “We see this as an incredible opportunity for industry participants to finally be able to effectively hedge their exposure to the price, credit, and liquidity risk inherent in this market.”
The three-way collaboration of Nodal Exchange, FreightWaves, and DAT enables financially settled, monthly term trucking freight futures contracts on the Nodal Exchange for seven directional lanes between major freight markets, three calculated regional averages, and one national average: Los Angeles to Seattle Van; Seattle to Los Angeles Van; Los Angeles to Dallas Van; Dallas to Los Angeles Van; Chicago to Atlanta Van; Atlanta to Philadelphia Van; Philadelphia to Chicago Van; West U.S. Van; South U.S. Van; East U.S. Van, and National U.S. Van.
DAT Solutions has developed the daily price assessments being used for contract settlement across the seven lanes and basket indices. The partnering firms said these contracts have been “chosen to provide a way for participants with exposure to truckload transportation costs to hedge their exposure.”
“While these futures contracts are new, the market should have great confidence that the data underpinnings for contract settlement are well established, with the truckload freight industry’s de facto standard for comprehensive, timely and accurate pricing information as its bedrock,” said Claude Pumilia, president and CEO of DAT Solutions.
For its part, FreightWaves is responsible for commercializing Trucking Freight Futures to industry participants “to build awareness and market liquidity.”
“Creating a Trucking Freight Futures contract marketplace has been three years in the making and would not be possible without the combined expertise and efforts of Nodal, DAT, and FreightWaves,” said Craig Fuller, FreightWaves CEO. “We’re excited to be part of bringing this transformative new form of price transparency and risk management to the freight transportation industry and look forward to seeing how both hedgers and speculators will participate.”