By Noam Fraenkel, VP Data and Analytics, Freightos
As the VP of Data and Analytics at Freightos, I find freight data incredibly exciting. This industry has always been at the forefront of connecting the world. Maritime trade has been around for millennia but the simple standardized freight container, together with the post-WWII global economy, ushered in a new era of global connectivity.
So when the Internet began to connect the world, freight was there too, embracing EDI to transfer data. But ironically the logistics industry’s capacity to transfer freight improved far faster than its ability to transfer freight data.
Freightos’ 300 million data points of air, ocean, and trucking pricing data represent a turning point. Our mission at Freightos is to make international trade frictionless. We believe that market transparency plays an important role in achieving this goal. More information means more efficient markets and more efficient markets means better decision making.
With Freightos AcceleRate™ and Freightos WebCargoNet™ freight rate management technology, used by over one thousand freight forwarders, and with countless businesses buying freight services online on the Freightos Marketplace™, we have accumulated the largest freight rate database in the world. And it’s getting larger, growing by over 10 million data points every week – that’s some 1,000 data points every minute.
The sheer quantity and scope of freight pricing and data enable us to do something we’ve been thinking about since Freightos’ early days – launching a freight index, which we call the Freightos International Freight Index (or FIFI, for short).
Let me answer a couple of questions you probably have.
Why Launch a Freight Index?
Given our commitment to freight transparency, launching a freight index is the next natural step. FIFI helps companies big and small easily access market price information for shipping containers on major trade lanes, aggregated from live business data, together with historical price behavior. This is an essential tool for making business decisions.
Why Launch it for Free?
Even though access to similar data assets typically sells for thousands of dollars per seat, our business is about improving freight sales and booking with Freightos AcceleRate, Freightos WebCargoNet and the Freightos Marketplace, not selling data. The data we’ve collected is valuable but we believe it can be best leveraged by the open market, powering better freight decision making. By making this index for the six main trade lanes available for free to everyone, we help level the playing field and empower all stakeholders with information that was previously scarce. All that we ask is that index users register for a free account and credit Freightos when quoting the index values.
What’s Wrong With Existing Freight Indexes?
There’s nothing wrong with existing freight indexes. But we think we can still do better.
FIFI is unique in that it leverages a full set of real-time, aggregated and anonymized business data that global carriers, forwarders, and shippers use for daily business. This is quite unlike most other freight indexes that rely on a relatively small set of sample data polled from market participants. Given the live business usage of this data, we believe these prices to be the most accurate representation of market rates. The bottom line is that by eliminating reporting inaccuracies and lag time, while tapping into an unprecedented broad market representation, FIFI represents market conditions as business operators actually experience it.
“Simply put Freightos is providing better data, providing it quicker, and removing the price tag.”
How is FIFI Data Calculated? How is information kept private?
The actual index data uses a mixture of our own systems and algorithms, powered by the services of Google Bigquery and the Google Cloud Platform. Business data must remain private of course. So we carefully scrub, anonymize, analyze and aggregate data to form the FIFI reports. The FIFI Index currently taps into 40’ container prices, while the estimate on the right side of the FIFI screen includes door-to-door air and ocean estimates for nearly global coverage.
Just to be perfectly clear, no personal, private or company-specific information is revealed by FIFI at any point, and the statistical analysis is always performed with the permission of the data owners.
The live nature of our data, the global coverage and wide modal scope, coupled with Freightos technology enable us to gain new and revealing insights. We feel that by sharing them with the industry, we are taking just one more step to increasing transparency and making global trade frictionless.