Platts LNG freight assessments

We assess LNG shipping day rates and ballast rates in the Atlantic and Pacific basins for modern vessels. These reflect the headline hire rate and ballasting economics of a spot fixture.

The assessments are compiled using market data collected from active market participants (including LNG ship owners, charterers and ship brokers) that is then published as "market heards" via the Platts real-time service, Natural Gas Alert (NGA). These market heards contain as many details as possible about the fixture, including the name of the vessel and charterer. These market heards are published in order to ensure market participants can react to, and scrutinize, market information being considered in the assessment process. We also report multi-month fixtures and vessel requirements, as market participants deem this information useful.

Platts assessments normalize for the vessel capacity, fuel consumption, timing/delivery dates, and charter duration. For example, when we hear a fixture for a Steam vessel, we normalize it to a TFDE day-rate equivalent value by considering the difference in fuel-economics between the engines and considering market-tested differentials between these two types of propulsion.

LNG shipping and ballast rates, JKM, and bunker prices act as daily-assessed inputs for the calculation of modelled freight cost value, in $/MMBtu, for voyages from 16 different load ports to nine different discharge ports.

For more details about our standards, please refer to our LNG methodology and specifications guide.

APDR, ATDR, Asia Pacific LNG Ballast Rate, and Atlantic LNG Ballast Rate, as well as the $/MMBtu route assessments, are available on NGA as well as the LNG Daily publication.

We communicate directly with sources at LNG ship owners, charterers and ship brokers.

We do not take into account information from a single segment of the market, i.e. only from ship owners, but seeks to canvass market inputs from as wide a cross-section of the market as possible.

On a daily basis, we focus communication on active LNG spot shipping market participants.

The number of companies that actively contribute to the assessment process totalled over 38 companies as of May 2019.

Some market participants have voiced the need for a potential LNG freight paper market. The reasons include the high cost of LNG shipping relative to the delivered price of the cargo, high volatility of LNG freight, as observed over Q418, for example, and the seasonality in spot pricing.