Hong Kong's Kerry Logistics in box swap derivative deal

HONG KONG's Kerry Logistics executed a container freight swap agreement earlier this week in what was regarded as a landmark development for the year-old trade in boxship freight derivatives, reports London's Lloyd's List.


But Kerry Logistics media centre in Hong Kong had no comment, only asking that questions be submitted by email. There was no response to the Hong Kong Shipping Gazette's email inquiry by press time.


A container freight swap agreement (CFSA) is described by its sellers as an intuitive risk management tool that allows hedging against price movements in Asian container export markets.


"By using container swaps, participants transporting seaborne containerised goods are able to stabilise future costs and crystallise future margins in a flexible and cost-efficient manner," said a statement on a promotional website.


What little shipping lines have said about container derivatives has been negative. "We don't seem to need the product," said China's "K" Line marketing chief Li Hongmei back in September. At the same time, Cosco and CSCL said they had no plans to enter the market. Hong Kong's OOCL said the market is of doubtful value, which followed similar comments from Maersk, APL and Zim.
(Source:http://www.schednet.com)