April 24, 2007

Norway launches salmon futures clearing

The world's first cleared futures contracts for fresh salmon is about to be launched by FISH Pool ASA, a Norwegian company, marking a milestone in the burgeoning seafood derivatives market.

The service will be officially launched at the European Seafood Exhibition in Brussels this week, where NOS Clearing ASA joins Fish Pool ASAs stand on the Norwegian Pavilion.

Fish Pool's Managing Director Soren Martens said that introduction of the salmon contracts was a milestone in the development in Norway and internationally as seafood contracts can now be traded the same way other commodities are traded on international exchanges.

This would provide protection against credit risk to each party in a transaction. Many participants are concerned about credit risk because of the forward nature of financial commodity contracts. The present arrangement allows each party to be guaranteed settlements from NOS Clearing ASA.

Credit risk is not an issue when trading cleared contracts, explains Erik Flingtorp from NOS Clearing. NOS Clearing will offer a tailored market solution where clients can choose from direct membership at NOS or to trade indirectly via existing clearing members.

Clearing services from NOS Clearing is an important corner stone for the company in increasing trading volumes, said Soren Martens. The company would also offer bilateral trading at Fish Pool in Norwegian Korne and Euro, with direct settlement between the trading parties.