The finding follows a review initiated in consultation with the GDT Events Oversight Board to investigate the factors leading to price outcomes for SMP UHT product in contract periods 1, 2 and 3 in Trading Event 207.
The review looked at the observed differences in winning prices for the SMP UHT product, relative to the SMP Medium Heat product in the relevant contract periods.
Assurance for participants
Eric Hansen, director of GDT, said the review provides assurance to market participants.
“Based on reports from the trading manager, our detailed analysis of Trading Event data, and feedback received from the relevant buyers and sellers, the principal cause of the difference in winning prices at this auction was persistently strong demand by multiple bidders for UHT against a consistent supply,” Hansen confirmed.
“GDT has also received feedback that contract execution will progress as normal between the successful buyers and the seller.”
Bill Shields, GDT Events oversight board chairman, said all trading platforms and marketplaces can be subject to unexpected volatility in prices when there are changes in demand and supply relativities.
“The structure and operation of the GDT Events trading platform is designed to ensure that the price level for each product, and differences in prices across products, are determined by the interactions of supply and demand, in order to achieve effective price discovery over time,” Shields added.