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Price Assessment

Platts JKM™ (Japan Korea Marker) LNG Price Assessment

  • What is the Japan Korea Marker (JKM™)?
  • How do we assess the JKM™ LNG market?
  • Evolution of Platts JKM™ Price Assessment

What is the Japan Korea Marker (JKM™)?

Platts Japan Korea Marker (JKM™) is the LNG (Liquefied Natural Gas) benchmark price assessment for spot physical cargoes delivered ex-ship into Japan, South Korea, China and Taiwan. As these two countries take the largest share of LNG imports in the world, Platts JKM™ is thus a key reference in marking product value/market price from supply source to the destination market.

In the LNG market space, traditional patterns of trade are evolving fast; where cargoes once changed hands only through opaque bilateral deals, the market now exhibits open sell and buy tenders for multiple and single cargoes, brokered trades, cargoes sold in longer chains and speculative trading positions taken up by non-traditional players, adding to liquidity on the spot market.

How do we assess the JKM™ LNG market?

Platts JKM™ price assessment reflects the tradable value of LNG at the given delivery period, based on the most recent repeatable trades, bids and offers. In addition, only bids and offers that are raised or lowered in realistic increments are considered within the assessment.

Platts LNG assessments are market-on-close (MOC) prices prevailing at 16:30 Singapore time or 08:30 GMT. The current standard ship and cargo size is defined as 135,000-175,000 cubic meters.

During the Platts JKM™ price discovery process, we survey as broad a cross-section of the market as possible, including traders, producers, end-users and brokers. Market players are contacted by phone, instant-message or email on a daily basis.

Information pertaining to current shipping costs and market supply/demand fundamentals -- such as production maintenances, tender issues and weather data -- is also taken into consideration during the Platts JKM™ price assessment process.

We publish reported bids, offers and trades during our MOC assessment process every day.

Evolution of Platts JKM™ Price Assessment

Platts was the first to launch daily LNG price assessments for cargoes trading in Asia, starting with Platts JKM™ in February 2009. As global supply and market participation grow, the uptick in liquidity of spot trading has seen the Platts JKM™ being increasingly used as a price reference for trades both in and outside Asia.

Spot trades generally represent around 20% of the LNG volumes traded yearly.

While the LNG market continues to be dominated by traditional 20 to 30-year long-term contracts, there is a marked movement towards shorter term and spot deals. Long-term contracts expose both buyers and sellers to market risks, as price fluctuations cannot be captured. Daily spot prices mitigate this risk by representing actual market value for the product bought and sold each day, making the inherent market volatility both visible and understandable.

New entrants into the LNG market are pushing for shorter term and spot deals, instead of the traditional long-term agreements. Therefore there is a need to establish a reliable, transparent and repeatable marker to reflect the fair and transactable value of the spot LNG market, a role the Platts JKM™ assessment serves.

With increasing non-associated gas production and shale gas development, the call to move away from oil-indexation, together with de-linking LNG prices from other commodities, becomes more prominent. As such, Platts JKM™ sees its presence continue to grow in the physical market. Alongside its gradual integration into physical contracts, Platts JKM™ has also been adopted in the financial markets, spearheaded by OTC derivatives trades in early 2011, as well as clearing by exchanges in 2012.


Methodology and Specifications

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See all Methodologies

Products and Services

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See all LNG products