Physical Freight Trading
Hello,
I'm off to work as a graduate trainee at an EU based shipping company soon. Wondering if anyone could share useful resources/information, as I would love to prepare myself for the role as much as possible. Of course, i'll be working in ops first so anything regarding the technical OR financial side is much appreciated.
Thanks!
www.ics.org.uk
Thank you
Considering you will be in the ops side of things you should read up on: regulations on cargo and cargo handling, stowage, bunkering, speed monitoring, performance monitoring, weather routing, demurrage and despatch.
Mind you, I don't think they would be expecting you to know all this, since it's quite technical.
Freight Trading Experiences? (Originally Posted: 10/15/2017)
Anyone familiar with this business? Seems like most of your commodity houses are involved in this (Vitol, koch, glencore, merc, traf), but I can't find much info on it. Any freight traders here willing to chime in about their experiences?
That's very useful thank you. They expect me to know nearly nothing, but i'm sure it will be helpful to get a head start on the lingo.
What do you want to know?
Biggest guys on the dry side are probably Cargill. Wet I think is Shell.
The big miners like BHP, Rio Tinto, and Vale are huge in the cape markets, whereas Cargill do huge volumes in the handy, supra and pana's.
I'd like to know how some of this works. Do you buy/sell these financial contracts on ICE? Is most of it done on ICE chat or OTC somehow? Are the "products" liquid?
Freight trading is mostly physical, and FFA's (financial contracts) are used to hedge positions.
The name "Freight Trader" is more commonly used at Cargill, others just call them chartering managers, or shipping managers at trading houses, brokerages and agencies. These desks are either or both to support traders for competitive shipping, or to trade in the open market to generate PnL.
You can fix the vessel on a spot or contract basis and its all dependent on your strategy. If you purchase on spot, you will hedge your risk with FFAs - assuming one is available or has correlation. Purchasing on contract basis usually locks in your rate for a period of time e.g 1 year at a set price - this is generally called COA.
Are FFAs liquid? Not as much as they used to be. The physical market is liquid, but margins are getting tight like commodities, and bunker prices have risen which makes certain berths very expensive to refuel.
Freight Trading (Originally Posted: 02/08/2013)
Anyone here do freight trading or in the freight/shipping industry? I've been networking with a friend's father, but am looking for more insight on the industry.
Also, he told me to contact someone. Just got the email today, Friday. Is it ever appropriate to email on the weekends, especially not knowing the person?
Don't email on weekends if you don't know them since you don't want them to check their phone on the weekend and see its from someone they don't know and is, quite frankly and no offense to you, someone low on the totempole.
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