JERA Global Markets, a joint venture between Japan’s JERA and EDF Trading, has reportedly issued a tender to purchase up to 0.5 million mt of LNG over January-March 2020.
According to S&P Global Platts, the tender closes on Thursday. It was unclear Tuesday whether the tender was issued because of incremental spot demand from Japan, portfolio optimization demand or lower nominations of pricier term volumes.
While traders said the requirement of as many as eight cargoes could provide some support for the winter market, forward prices failed to reflect this Tuesday.
This will probably be JERAGM’s first tender issuance to buy short-term LNG volumes since the launch of its LNG business in April. The company has traded 8 million tonnes of LNG globally since then, according to a company presentation during an industry conference on September 26.
Sources told S&P Global Platts that JERAGM had been active in the pre-winter market buying a string of September deliveries due to warmer temperatures in Japan and low spot prices.
Furthermore, the company’s buy tender comes on the heels of a similar tender concluded last month by Taiwan’s CPC for up to 12 cargoes, for one cargo per month delivery over 2020.
It is worth noting that demand expectations from South Korea, the world’s third-largest importer, continue to hinge on the scale of implementation of the country’s coal-fired plant shutdown proposal expected to be finalized at the end of October.
LNG World News Staff