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Exchange for International Container Freight Launches Member Council

Box Line Shipping Talent Added to Board of Directors US – WORLDWIDE – It has long been the vision of many, both in the supply and carriage of cargo, to introduce a container freight shipping exchange, much as bulk cargo contracts are negotiated, traded and settled in London on the Baltic Exchange. Hitherto various constraints have inhibited forward trade on such a basis, with aspirations never being realised, but in 2015 came the formation of the New York Shipping Exchange (NYSHEX[1]) which is attempting to enable the box trade to operate to some degree on similar lines.

The NYSHEX policy is a two tier philosophy, to create and establish a new standard form, enforceable, container freight contract, and to use modern technologies to trade ocean freight digitally. Now the organisation has announced both additions to its board of directors, and the launching of a governing NYSHEX Member Council.

The NYSHEX governance model adds four industry representatives to its board of directors, two will be filled by shipper members Beneficial Cargo Owners (BCOs) or NVOCCs, whilst two will be carrier members. The four industry representatives joining the board are: Bjorn Jensen, VP Global Logistics for Electrolux; Jochen Gutschmidt, Head of Global Procurement at Nestle; Nick Fafoutis, SVP of Sales and CCO of CMA CGM America and Donald Davis, SVP of Sales and Customer Service for Hapag-Lloyd in North America. The governance model also establishes the NYSHEX member council consisting of three BCOs, three NVOCCs, and three Carrier representatives.

This announcement follows the Federal Maritime Commission’s (FMC) December 2, 2017 approval of the NYSHEX governance model. NYSHEX says it now ushers in a fair, transparent and compliant process to ensure the interests of members are incorporated into the operation of the exchange. Gordon Downes, NYSHEX CEO, said:

“As we continue to grow the exchange, our governance model ensures that our members, actively participate in the oversight and governance of the exchange. We are excited to have these industry innovators and leaders help NYSHEX to establish fair and transparent standards for digital freight contracting, and to build enabling technology that everyone in the industry can benefit from.” The NYSHEX board is supported by the NYSHEX member council whose role is to propose recommendations or changes to NYSHEX operations, processes, and technology.

The industry representatives who will join the NYSHEX member council are: Mark Chadwick, Executive Sourcing Leader, GE; Glenn Berger, VP Global Transportation, Restoration Hardware; April Zobel, Export Traffic Manager, Lansing Trade Group; David Newton, CCO, Damco USA; Nerijus Poskus, VP Global Head of Ocean Freight, Flexport; Arnold Lee, CEO of Hecny Group; Peter Hildebrandt, VP Revenue Management and Optimization, Maersk Line and Howard Finkel, EVP, COSCO Container Lines. To ensure the industry and exchange members are impartially represented, the industry board members and the member council representatives will rotate on a yearly basis. Although containers have been around for the entire working life of almost everybody in the freight trade, it is easy to forget that this, arguably the most important modal method, only really began with the inception of the modern intermodal container in the mid 1950’s.

The presence of members from five of the world’s ten largest container shipping lines shows that this latest attempt to influence the way box freight is traded is being taken seriously. As logistics becomes more streamlined and efficient in a bid to supply the ever more demanding market for fresh orders shipped even faster, we now see numerous smaller, less formal ‘exchanges’ for road freight operating, with vehicles offering backload services around their various states and countries. Large manufacturing, wholesale and retail groups already negotiate forward contracts with individual container lines, perhaps making maritime exchanges of this type the next logical step for many.

The intention is of course to take the element of chance out of what can undoubtedly be a volatile spot market.

Such manoeuvres of course, as with currency trading, can work both ways but, set against this, there have been some particularly prickly cases in the past when a shipping line has raised rates, sometimes threefold[2], annoying a customer who perhaps had budgeted at what they thought was a fixed price, something a new, enforceable contract would eliminate.

Exchange for International Container Freight Launches Member CouncilExchange for International Container Freight Launches Member Council


  1. ^ NYSHEX (www.nyshex.com)
  2. ^ particularly prickly cases in the past when a shipping line has raised rates, sometimes threefold (www.handyshippingguide.com)

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