TOCOM Energy

On August 16th, for the first time in two years since August 2022, trading was concluded in yen-denominated liquefied natural gas (LNG) Futures listed by Tokyo Commodity Exchange, a group company of the Japan Exchange Group (JPX).

The deal was concluded for “JKM (Japan/Korea Marker)” futures, an index for spot trading of LNG bound for Japan and other Asian countries. A total of 50 contracts (or trading unit) were executed for the November 2024 futures contract. It traded at 2,110 yen per million BTU (British thermal unit) in afternoon trading.

Yen-denominated LNG futures can hedge the risk of price fluctuations of LNG traded in dollar-denominated contracts. Combining LNG futures for fuel with Electricity Futures is expected to be used in “Spark Spread” trading, where power companies fix in profits from power generation.

Takashi Ishizaki, President of TOCOM, says, “We are working to improve the market maker programs to increase market liquidity, and we will continue to promote the market so that transactions will continue to expand.”