11th January 2018
New Baltic Exchange LNG Panellists Group
Following an approach by leading Baltic Exchange LNG shipbroking companies, the Baltic Exchange has formed the Baltic LNG Panellists Group. The move comes as the Baltic Exchange looks to develop a new Liquified Natural Gas (LNG) Index comprising several routes for the evolving LNG shipping market.
Affinity, Braemar ACM, Clarksons and SSY are the LNG Panellists Group’s first members and they are currently assessing a range of LNG routes before reporting moves to a trial phase.
Commenting on the formation of the new group, Baltic Exchange Chief Executive Mark Jackson said:
“The growth in LNG transported by sea has led to the formation of a spot market. However, any spot market needs to be underpinned by standard contractual terms - as already happens in the tanker and dry bulk freight markets. The Baltic Exchange is looking to support the LNG freight market as it matures and we hope to deliver greater transparency through an index. We are delighted that four of the most important independent LNG shipbroking companies have joined our panel and we look forward to developing a set of standardised assessments for use across the fast-growing LNG industry.”
In recent years the substantial global increase in natural gas production and rising imports by India, China, Pakistan and Egypt has led to a fundamental change in LNG shipping market dynamics. In addition, more contracts are being signed for shorter durations and smaller quantities, without fixed destinations. Trade patterns have diversified as new import and export terminals have been built and the LNG fleet continues to expand. Until recently, the LNG shipping market was characterised by low levels of spot market activity, with the majority of business conducted on a long term contractual basis.
Various routes are currently being evaluated by the Baltic LNG Panellists Group. Once finalised their proposal will be presented to the Baltic Index Council for approval and trial phase.
The Baltic Exchange is the world's only independent source of maritime market information for the trading and settlement of physical and derivative contracts. Its international community of over 640 members encompasses the majority of world shipping interests and commits to a code of business conduct overseen by the Baltic.
Baltic Exchange members are responsible for a large proportion of all dry cargo and tanker fixtures as well as the sale and purchase of merchant vessels.
In November 2016, the Baltic Exchange was acquired by Singapore Exchange (“SGX”), bringing together complementary strengths of Singapore and London, two of the world’s most important maritime centres.
Baltic Exchange services
- Independent, high quality dry, wet and gas freight market information
- Self-regulated chartering, sale and purchase and freight derivatives markets
- Central forum for competing freight market interests
- Framework ensuring high standards of business practice and co-operation
- London-based business facilities for members