Baltic Exchange releases data on freight derivative volume trends in 2020


Dry Bulk

Published by , Assistant Editor

Dry Bulk, Wednesday, 06 January 2021 14:30

The freight derivatives markets for both tankers and dry cargo vessels saw increased traded volumes in 2020, according to data released by the Baltic Exchange.

Tanker Forward Freight Agreement (FFA) volumes were up 31% on the previous year, reaching 603 261 lots, with a daily record of 33 677 lots achieved on 16 March at a time when Time Charter Equivalent earnings for VLCCs exceeded US$275 000.

Dry FFA volumes hit 1.54 million lots, up 17% on 2019. Options trading in the dry market hit an all-time high, up 37% on the previous year to 318 183.

One lot is defined as a day’s hire of a vessel or 1000 t of ocean transportation of cargo.

Commenting on the figures, Baltic Exchange Chief Executive Mark Jackson said:

“2020 was another impressive year for the freight derivatives market. Underpinning these volumes are volatility, trust in the Baltic Exchange’s settlement data and increased participation by owners, charterers, and traders. Last year both the dry bulk and tanker markets experienced big swings amid the IMO 2020 fuel change, collapse in oil price and COVID-19 pandemic. The previous 12 months saw 1.5 million dry FFAs traded, representing growth of around 70% since 2012.”