SUBSCRIBER NOTE: Platts proposes to normalize CIF Japan P1020 indications

S&P Global Platts proposes to normalize all bids, offers and trades reported as part of its assessment process for the primary aluminum CIF Japan Spot Premium (MMANA00) to a base month from June 1, 2018.

Platts is opening a formal market consultation, encouraging feedback from all market participants, on this topic. Platts seeks feedback on this subject by March 23, 2018.

Trade activity in this market is predominantly on a floating price basis to the average cash settlement prices of the underlying futures in the month of shipment. However, other floating price formula have been observed.

Furthermore, with a wide range of supply sources and a wide loading window being assessed, indications reported to Platts can be against different quotation periods.

Platts has observed that when different quotation periods are used the structure (backwardation or contango) of the underlying futures market can materially affect the trade price agreed.

BASE MONTH:

In order to ensure the underlying structure is accounted for when assessing the CIF Japan Spot Premium and to compare all P1020 indications against the same base, Platts is proposing to start normalizing indications to a base month.

The base month would be calendar month plus one, rolling on the first business day of the month.

For example, from February 1 to 28, 2018 Platts would normalize all indications to "March average-related"; from March 1, Platts would normalize all indications to "April average-related".

It is important to note that under this proposal Platts would continue to consider for assessment all indications regardless of basis month or origin (subject to Platts methodology & guidelines). This proposal is intended only to ensure that all indications are normalized to the same basis.

Platts invites comments, questions and other feedback on these proposals by March 23, 2018. Please submit any feedback, comments or questions to pricegroup@spglobal.com.

For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing. Platts will consider all comments received and will make comments not marked as confidential available upon request.