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Baltic adds new LNG indices, CME futures to follow

Photo: Rahita Elias SGX sign outside office buidling
The Baltic Exchange added new indices for LNG carriers burning LNG as their primary fuel on March 2, with data available from the start of 2020.

The new indices will be published twice weekly with the acronym BLNGg, separating the vessels from those burning very low sulphur fuel oil on the LNG1-3 indices launched in 2019.

The new standard Baltic vessels will have the following specifications: 17 knots on 210 cu m LNG per day laden, 16 knots on 190 cu m LNG per day ballast, 0.1% boil off, Port consumption 42 cu m LNG per day idle, Port consumption 85 cu m LNG per day working.

Assessments are available on the routes Australia to Japan RV (BLNG1g), US Gulf to Continent RV (BLNG2g) and US Gulf to Japan RV (BLNG3g) in USD per day. The Baltic’s LNG1, LNG2 and LNG3 routes for VLSFO-burning carriers share the same departure points and destinations.

The Baltic indices will be the basis for three new futures from CME Group from March 22, pending regulatory approval.

“As LNG markets continue to evolve globally, demand for new tools to manage the risk around its transportation is also growing rapidly,” said Peter Keavey, Global Head of Energy at CME Group. “The introduction of contracts based on the usage of LNG as bunker fuel among global shipping routes is the next step in the evolution of freight and provides another market-based solution to help our customers to manage their global gas risk.”

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In May 2020, the Baltic Exchange launched a quarterly ship operating expenses assessment for LNG tankers to add to its spot market earnings data.

The latest addition to the Baltic’s LNG data follows the formation of a Baltic LNG Panellists Group in 2018, which brought together Affinity, Braemar ACM, Clarksons and SSY to assess LNG routes.