Baltic Exchange to shut down Baltex

The Baltic Exchange said it plans to close its freight derivatives platform Baltex on Dec. 29, following a recent announcement by LCH Clearnet that it would end its freight derivative clearing services by the end of the year.    The London-based Baltic Exchange, which has long compiled indexes for dry bulk and tanker markets, said Monday it will close its freight derivatives platform Baltex on Dec. 29, subject to all relevant regulatory approvals.
   Baltex is a multi-lateral trading facility for dry freight derivatives that launched in June 2011. It is used by forward freight agreement brokers to “futurize” their clients’ trades for clearing at LCH.Clearnet.
   The decision to close Baltex’s operations came after a “review of strategic operations” following a recent announcement by LCH that it would end its freight derivative clearing services by the end of the year, the Baltic Exchange said.
   “Baltex will remain open until all open positions at LCH have either been closed out or have been novated to another clearing house,” the Baltic Exchange said.
   LCH is majority owned (57 percent) by the London Stock Exchange, with the remainder being owned by its users (i.e. clearing members) and other exchanges.
   The Baltic Exchange was acquired by the Singapore Exchange in November 2016 for 87 million pounds (U.S. $115 million). Founded in 1744, the Baltic Exchange launched its first series of freight market indexes in 1985 and currently provides freight indices for both the dry bulk and tanker markets.