SGX to launch Australian coking coal futures contract
Sydney (13 August)
The Singapore Exchange (SGX) aims to launch a coking coal futures contract – based on McCloskey’s MCC3 Australian FOB second-tier hard coking coal (HCC) index – in September because of market demand.
SGX’s contract launch timeline is subject to regulatory processes, the exchange told some traders on 5 August. It plans to brief market participants on the contract before launch, Lithos understands.
SGX did not immediately respond to a request for comment.
Market participants will be able to trade SGX’s second-tier coking coal futures contracts for up to three calendar years, according to draft specifications seen by Lithos. The contracts will financially settle against McCloskey’s average daily MCC3 Australian FOB second-tier HCC index price in expiring months.
McCloskey’s index price tracks the value of lower-grade HCC shipments leaving East Coast Australian ports, according to the price reporting agency.
Producers shipped 147 million tonnes of coking coal out of Australia in 2025, down 3.9% from 2024, data from Australia’s Office of the Chief Economist (OCE) show. The OCE expects Australian producers to export 154 million tonnes of coking coal in 2026.
SGX’s second-tier coking coal futures contract will form part of its ‘virtual steel mill,’ a series of financially-settled iron ore, coal, and freight derivatives that help traders manage market risks. The exchange already offers Australian premium coking coal futures and swaps contracts as part of its ‘virtual steel mill.’
September-dated SGX TSI FOB Australia premium coking coal futures contracts last settled at $224/tonne on 11 August, down from $233.50/tonne on 10 July, data from SGX show.
SGX’s futures contract outreach comes less than two months after SGX Head of Commodity Derivatives Tan Tee Yong told Reuters that the exchange planned to launch new coking coal and steel futures.
By Avinash Govind