Following a strategic review, LCH.Clearnet (LCH) has notified the FFA market that, from 28 December 2017, it will no longer be providing clearing services for dry freight derivatives contracts, as well as options contracts. The Baltic Exchange provides settlement data to all the clearing houses providing clearing services to Forward Freight Agreement (FFA) traders.
LCH has entered into a Novation Agreement with European Energy Exchange (EEX), giving its clients and members the option to novate their open interest from LCH to EEX. The novation option is only available between LCH and EEX.
Members wishing to move their positions to a Clearing House other than EEX should speak to their General Clearing Member (GCM).
We do not anticipate any financial impact to the Baltic Exchange arising from LCH.Clearnet’s decision to cease trading or for overall FFA trading volumes to be negatively affected.
Please see the relevant announcements from the Clearing Houses below: