Index‑linked freight contracts keep rates aligned with the market, so you’re not stuck renegotiating every time prices swing. Instead of a fixed number, the contract references a benchmark - like “97% of FBX01” - and updates on a set schedule (monthly or quarterly). In Terminal, you can set up, model, and track index‑linked agreements in one place, including floors, ceilings, and bounds.

Why Shippers use Index Linking:

- End the annual RFQ grind. Replace long, costly tenders with automated updates that stay in step with the market.

- Protect against shocks. Avoid rolled boxes, surprise surcharges, and force majeure headaches during disruptions (e.g., Red Sea, strikes, severe weather).

- Build better partnerships. Take the heat out of renegotiations and maintain win‑win relationships as the market moves.

- Save time and focus. Cut renegotiation churn and free up teams for strategic work.

How Terminal helps

Track: Monitor index‑linked performance against your formula, with floors, ceilings, and change bounds visible over time—right in your dashboard.

Model: Use an out‑of‑the‑box template to simulate ocean container index‑linking before you commit.

Negotiate: Leverage a ready‑made sales toolkit and contract template to speed up agreement cycles.

Hedge: Pair your index‑linked exposure with container freight derivatives based on the Freightos Baltic Index (FBX), traded on CME and SGX, for extra budget protection.

Why FBX (and FAX) work for Index Linking:

FBX is administered by the Baltic Exchange and is BMR‑compliant. It processes millions of spot ocean price points each month, covers a global composite plus 12 core trade lanes, and is trusted by major exchanges (CME, SGX) and organizations from top BCOs to the World Bank. FBX benchmarks reflect real, anonymized transactions and include relevant freight surcharges (e.g., BAF, CAF, PSS, GRI, canal surcharges), giving you a dependable reference for indexed formulas. For air, FAX provides daily, transaction‑based spot benchmarks across 120+ region pairs, with weight‑break granularity.

What is (and isn’t) in the Benchmark Price:

Benchmarks reflect pure carrier sell rates or forwarder buy rates. They exclude forwarder‑specific margins, handling, and documentation fees. Ocean benchmarks are CY‑to‑CY and air are airport‑to‑airport; local origin/destination charges (THC, DTHC, customs, pickup/delivery) aren’t included - except that US‑inbound ocean often includes DTHC charged by carriers.

Getting Started in Terminal:

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Set guardrails: Add floors, ceilings, and rate‑change bounds to keep budgets predictable while staying market‑aligned.

Save and track: Monitor performance over time, compare to spot or contract trends, and export as needed for procurement and finance.

Notes on Coverage and Setup

Index linking is available for ocean (FBX) and, where applicable, air (FAX). Availability may vary by plan. If you expect access but don’t see it, reach out to us via in-app chat or email terminal@freightos.com.