ASIA LNG MOC: Nov JKM physical and derivatives markets hit new highs despite shoulder season lull

The Platts Market on Close assessment process for Asia’s LNG physical market recorded its second-highest level of activity during the November JKM pricing period (Sept. 16-Oct. 15), just shy of the record seen in the previous pricing cycle.

A total of 625 market entries were reported by 25 entities, comprising 285 bids, 317 offers and 23 trades, for deliveries spanning the second half of October through December. This represented a 196.21% increase year over year, and a 12.95% decline month over month.

Despite a seasonal lull in spot LNG demand across Asia during the shoulder months, activity in the cargo MOC remained robust, averaging 28 bids, offers and trades per day.

“The market seems to have returned to the 2018-2019 period of low flat prices, low volatility and low margins,” said a Singapore-based trader, noting that thinner trading margins have driven players to “churn more cargoes” to sustain profitability.

The Platts JKM for November delivery, the benchmark price for cargoes delivered into Northeast Asia, averaged at $11.016/MMBtu, ranging between the mid-$10s and mid-$11s/MMBtu during the pricing period.

This compares with higher levels seen in 2024, when JKM averaged in the high-$12s to mid-$13s/MMBtu, and a wider range in 2023, between the mid-$12s and high-$16s/MMBtu.

This increased churn, coupled with the increased standardization of LNG cargoes, has resulted in longer cargo chains. Platts earlier reported a single mid-August delivery cargo that changed hands 46 times in the spot market.

Most market activity centered on deliveries into the Japan-Korea-Taiwan-China region, while interest also extended further south, with eight bids for delivery into India and two bids for delivery into Thailand.

Among the 23 physical trades, totaling about 1.49 million mt of LNG, Glencore emerged as the most active buyer with six cargoes, followed by QatarEnergy Trading with seven and PetroChina with five. Shell and TotalEnergies each bought two cargoes, while Jera Global Markets bought one.

On the sell side, BP led the pack with 11 cargoes, trailed by PetroChina with four and Vitol with two. Other sellers included Engie, Gunvor, Mercuria, RWE, Tokyo Gas Energy Trading, and Trafigura, each selling one cargo.

Fourteen trades were linked to the JKM December contract, averaging a 2.2 cent/MMBtu discount for November deliveries, while 10 trades were tied to the JKM balance-of-month contract, averaging a 0.02 cent/MMBtu discount. Only three trades were concluded at fixed prices, averaging $10.933/MMBtu.

Overall, 75% of the bids, offers and trades were indexed to floating prices, primarily to JKM full-month or balance-month contracts. Meanwhile, 24.6% of orders were placed at flat prices and 0.3% were linked to the Dutch TTF index.

Derivatives MOC sees all-time high

In the derivatives MOC, an all-time high of 3,756 market entries were reported from 24 participants comprising 1694 bids, 1441 offers and 621 trades, surpassing the previous record set in July 2025, when market entries totaled 2,536.

The figure more than doubled year over year and was up 66.86% month over month.

The JKM balance-month contract accounted for 42.94% of derivatives activity, followed by December (41.11%), November (12.91%), January (2/82%), and the November/December spread (0.21%) contracts.

On financial exchanges, JKM futures' traded volume over Sept. 16-Oct. 15 reached 99,209 lots, equivalent to around 19.08 million mt or 301 cargoes. The MOC process accounted for nearly 16% of that volume.

Weak end-user demand weighs

Buying interest remained subdued, with the Platts-assessed November JKM averaging $11.016/MMBtu, down 3.03% month over month and 15.96% year over year. The price weakness was due to mild seasonal demand and ample inventories, market sources said.

Still, sporadic bursts of demand surfaced as prices dipped to their lowest point of the period on Oct. 2 at $10.494/MMBtu, drawing in opportunistic buyers from Northeast, Southeast, and South Asia.

For most of the region, however, inventories remained comfortable, keeping spot appetite muted. China, in particular, showed limited interest in spot cargoes, even with JKM slipping below the mid-$10s/MMBtu level, as cheaper pipeline gas and domestic production continued to undercut LNG.

“Demand from China will only pick up if prices fall below $10/MMBtu,” a trading source said, while another Singapore-based trader said that term contract volumes were likely sufficient to meet China’s winter needs.

Meanwhile, the East-West arbitrage window for US-sourced LNG cargoes into Asia remained firmly shut, with the Platts-assessed differential averaging minus 43.6 cents/MMBtu through the November pricing period.

Offers reported on the cargo MOC with US base load ports fell 44.9% compared with the October pricing period, signaling diminished arbitrage-driven flows.