National Commodity & Derivatives Exchange Road Freight Index

Since November 17, 2005, NCDEX is displaying on its website a Road Freight Index for India called FREIGHTEX. The index encompasses 50 high-density routes (which are subject to change) and is structured on the basis of the weekly movement in freight rates. A change in the freight rate in any of these 50 routes would revise the index upwards or downwards. The freight rate data is obtained from the Transport Corporation of India Limited.

The index represents a simple average of the freight rates across these 50 routes, for a distance of 1000 kilometers. Thus, the index captures the movement of freight rates for a representative distance of 1000 kilometers, and dissociates the rate from the specific locations.

The purpose of the Road Freight Index is to help in the discovery of freight rates and thereby provide a robust mechanism to both shippers/users (companies which desire to move goods) and transporters (truckers) to manage their price risk.

“The Road Freight Index is not tradable today as it does not qualify as a commodity under the FCRA Act. The purpose is to provide this information to concerned users so that as and when regulation permits futures trading on this product, the market would be ready to trade the index”, said Mr. P.H. Ravikumar, Managing Director and CEO, NCDEX Limited.