A commodities or securities market in which goods are sold under a purchase order or contract at the price prevailing at the time of the sale and delivered immediately. In spot market sales, the purchaser is not obligated to acquire any additional goods or services, as they may be un ongoing contract.

Spot market sales are typically resisted in project finance transactions because there is no consistent revenue flow that can be relied on to repay the debt incurred to construct the project. A long term offtake agreement with an agreed purchase price (subject to adjustment or escalation in certain cases) is the preferred method used to sell a project's output. However, in some cases, a project company may be permitted to sell uncommitted output or capacity in the market for excess cash. Depending on the terms of the financing, all or a percentage of the revenues from the sales may be applied toward pre-paying the debt.

For a discussion of spot market sales, merchant projects, and the importance of consistent cash flow in project finance transactions, see Practice Notes, Project Finance: Overview: Offtake Agreements and Identifying and Managing Project Finance Risks: Offtake Risk.

For information on spot market sales in specific sectors, see Practice Notes: