SGX expands clearing services for seaborne freights

The Singapore Exchange adds three new Forward Freight Agreement and futures contracts for LNG vessels.

The Singapore Exchange (SGX) on Monday launched three new Forward Freight Agreement (FFA) and futures contracts for liquified natural gas (LNG) vessels.

This expands the SGX’s clearing services for seaborne freights.

The contracts are listed out to three years forward, referencing the independent freight price assessments of the Baltic Exchange for LNG transported on LNG-powered carriers from Australia to Japan, US Gulf to Europe, and US Gulf to Japan. These three routes constitute the bulk of the global spot market for LNG flows, serving as benchmark pricing for LNG freight.

“Asia plays an important role in the LNG freight market given the region’s geographical proximity to the epicentre of LNG trade flows. Our expansion into LNG freight marks a milestone in SGX’s FFA business since we cleared the first FFA OTC swap in 2006,” said William Chin, head of Commodities at SGX.

Global LNG trade reached an all-time high of 356.1 million tonnes in 2020, with Asia accounting for over 70% of global LNG imports. Japan and China are the top LNG importers, accounting for 40% of last year’s total.

LNG requires highly specialised and sophisticated vessels to transport, and its freight cost can significantly impact the delivered price of LNG, making it critical for industry participants to protect against price volatility.

Join Singapore Business Review community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

HongKongLand had the most growth for the day.
It surpassed the Bloomberg consensus estimate of 14.5%.
The agreement aims to grow tourism and economic activities as borders reopen. 
It will also enter a loan agreement worth $210.6m.
The acquisition will be fully funded by cash through internal resources.
These countries are Cambodia, the Maldives, Sri Lanka, Thailand, and Turkey.
The decrease was driven by profit declines in their beer and non-alcoholic businesses.
Sources say the state-owned Chinese firm is in talks with advisers about the potential divestment.
The tests start on 29 November.
Exercise CyberMaritime 2021 puts the sector's cybersecurity readiness to the test.
This is equivalent to 236 attackers per company in a year.
Genting Singapore was seen with the most growth.
The partnerships aim to improve care delivery and patient outcomes.