NEW CHAIRMAN FOR BALTIC FREIGHT DERIVATIVES BROKERS
Andy Lucey of UK freight derivatives broker, Freight Investor Services, has been elected as the new chairman of the Forward Freight Agreement Brokers' Association (FFABA) for 2004.
Commenting on his appointment Andy Lucey said: "These are exciting times for the freight derivatives industry. The price increases in freight rates over the past year, but especially the last 4 months, has brought freight to the attention of a new trading community who have subsequently come to realise that freight is a manageable and tradable commodity. This is helping to drive huge growth in the trading of freight derivative products. I am delighted to have been appointed chairman of this important group at such a pivotal time for the industry. I look forward to working with the Baltic Exchange to ensure that through its index products it continues to meet the needs of the derivatives market."
Paul Mazzarulli, a tanker derivatives specialist of US based Mallory Jones Lynch Flynn & Associates has also been appointed as FFABA vice-chairman.
The Association, which has 18 member companies, was established in 1997 by members of the Baltic Exchange and operates within the framework of the Exchange, the world's premier maritime market. All FFABA companies are members of the Baltic Exchange. The FFABA promotes the trading of forward freight agreements (FFAs) and works closely with the Exchange in the production and development of route indices for use as settlement mechanisms for FFA contracts through its membership of the Baltic's Freight Market and Futures Consultative Group.
ENDS
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Notes to editors
Andy Lucey is a director of Freight Investor Services (FIS), a dedicated freight derivatives broking company with offices in London, Athens and Tokyo. He was previously a director of SSY Futures and spent 12 years as a derivatives trader with Cargill Investor Services.
FFAs provide a means if hedging exposure to freight market risk through the trading of specified time charter and voyage rates for forward positions. Settlement is effected against the relevant Baltic route assessment.
The Baltic Exchange is the world's only self-regulated shipping market maintaining professional standards, resolving disputes and providing market information. With over 500 member companies from all over the world it is the largest shipbroking market and its international members handle a very large proportion of all dry cargo and tanker fixtures.
Each day the Exchange handles over 600 separate pieces of information to compile its unique freight market information, including some 41 route rates from 25 panellists in 10 countries. More than half the world's new and second hand tonnage is bought and sold by Baltic members in a market which, according to Clarkson's Research, was worth around US$34 billion in 2002.
Commissions from chartering and sale and purchase in 2002 (latest available figures) amounted to more than US$½ billion.
The Baltic Exchange ensures the relevance and robustness of its freight market information by regularly consulting with the users of its data.
Control of responsibility for Baltic freight market information lies with the Freight Indices and Futures Committee (FIFC), which is made up of five Baltic Exchange directors and in turn reports to the Baltic Board. The FIFC receives industry input from the Freight Market and Futures Consultative Group which covers the:
- Panellists
- Forward Freight Agreement brokers
- Principals
- Traders
