FFA

Capesize Rates at 18-Month High on Strong China Demand

Capesize rates hike 18-month high, says an article on S&P Global.

Capesize dollar per ton freight rates

China’s insatiable demand for iron ore and a bullish Freight Forward Agreement, or FFA, market along with a displaced tonnage supply situation has driven up Capesize dollar per ton freight rates to an 18-month high.

Freight

Freight levels on key iron ore shipping routes — Western Australia to China and Brazil to China — have spiked noticeably from early April, after witnessing a surprisingly...

https://mfame.guru/capesize-rates-at-18-month-high-on-strong-china-demand/

EEX Expands Its Dry Bulk Freight Portfolio

The European Energy Exchange (EEX) will expand its range of products for the Dry Bulk Freight market with the launch of Handysize 7TC Freight Futures which will be available for Trade Registration from 19th April, reports EEX.

The contract

Following a period of strong growth in the charter market, the new Handysize contract will help customers manage their exposure by enabling them to clear Forward Freight Agreement (FFA) trades for the 38,000-dwt Handysize Time Charter basket of routes.

The...

https://mfame.guru/eex-expands-its-dry-bulk-freight-portfolio/

Shipping Companies Utilize FFAs Against Freight Rate Volatility

Largely ignored by container shipping industry since their inception over a decade ago, container freight derivatives are finally seeing increased use as shippers and forwarders seek tools to protect themselves against freight rate volatility, reports The Load Star.

Forward freight agreements

Derivatives, alternatively known as forward freight agreements (FFAs), have long been an established part of the dry bulk and tanker markets, but for many years remained unused in container shipping.

However,...

https://mfame.guru/shipping-companies-utilize-ffas-against-freight-rate-volatility/

Handysize Time Charter FFA Trades To Witness ‘Less Risk’

Forward freight agreement (FFA) trades for a basket of 38,000-dwt handysize time charter rates will help operators take longer-term cover with less risk, reports Marinelink.

Early regulatory approval

Following an ever-strengthening charter market, SGX have confirmed a launch date for the new offering as April 19, 2021, with EEX aiming for early May pending regulatory approval. Both exchanges are keen to promote clearing of the new contract.

The handysize futures market was previously based on the...

https://mfame.guru/handysize-time-charter-ffa-trades-to-witness-less-risk/

DryBulk FFA Market: FFAs Rise Amid Escalating US-China Trade

With a single Tweet from President Trump, the flames of the US and China trade war have rekindled and rattled the global markets, based on an article by Freight Investor Services.

Political instability

Political instability between the US and China shook market confidence and prompted falling freight rates. However, the falls were also accelerated by lack of cargoes from Brazil after a court ruling reversed the restart of Vale’s Brucutu mine.

Limited Seaborne iron ore cargoes from Brazil
  • Iron ore...

http://mfame.guru/drybulk-ffa-marketffas-rise-amid-escalating-us-china-trade/

Baltic Exchange To Adapt Its Benchmark Dry Bulk Freight Indexes Ahead of IMO 2020

  • Baltic Exchange to adapt its benchmark dry bulk freight indexes to upcoming IMO 2020 regulations, by using vessels without scrubbers in its timecharter calculations.
  • Prediction is that in January 2020, not more than 10% of trading ships will have scrubbers installed, making no-scrubber vessels the standard benchmark vessel.
  • It published freight rates for benchmark shipping routes across the tanker, dry bulk and container sectors, and freight indexes.
  • S&P Global Platts competes with the Baltic...

http://mfame.guru/baltic-exchange-to-adapt-its-benchmark-dry-bulk-freight-indexes-ahead-of-imo-2020/

FFA Market Traces Back to Its Route Through Brazil-China Grain Trade

  • FFA market goes ‘back to its routes’ with the launch of cleared futures contract enabling users to hedge booming Brazil-China grains trade.
  • New route offers shipowners and grains market players on the key Brazil-China soyabeans route a complementary method to the existing Panamax P2A route.
  • Current pricing of $32.042/tonne FIS estimates that each P8 trip carries approximately $2m of unhedged freight risk.
  • The market for seaborne transport of soyabeans is approximately 150m tonnes per annum,...

http://mfame.guru/ffa-market-traces-back-to-its-route-through-brazil-china-grain-trade/

Freight Derivatives and Iron Ore Futures Volumes Soar

  • The macro-economic factors and the tragic events in Brazil along with uncertain US-China trade relations heightened uncertainty and created trading opportunities.
  • The total impact on the FFA market was to increase combined FFA volumes by 44% in the year to date 2019.
  • Brazil’s exports curtailed with export demand switching decisively to Australia.
  • China set to import 60% of Australian production and 70% of global seaborne trade volumes of 1.5bn tonnes in 2019.
  • Iron ore price prediction for 2019...

http://mfame.guru/freight-derivatives-and-iron-ore-futures-volumes-soar/

Drybulk FFA Market: Vale’s Woes Continue to Dull Capesize Rates

  • Vale has reached an agreement with Brazilian authority to resume operation of four previously halted pellet plants in Tubarao, Brazil.
  • It is expected to suffer a shortfall of 40 million mt per year in its iron ore output from the decommissioning of its ten dams.
  • Capesize 5-time charter average has bagged spot price of $7,342, up $58 day-on-day basis.
  • Panamax remained unaffected by capesize while Supramax emerged as a strong contender with $5,634.

The return of Chinese trade participants from...

http://mfame.guru/drybulk-ffa-market-vales-woes-continue-to-dull-capesize-rates/

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