SUBSCRIBER NOTE: Platts updates US Aluminum Transaction premium methodology

Effective April 1, Platts has updated its normalization processes for its US Aluminum Transaction premium assessment (symbol MMAKE00) to reflect changes in the supply structure in North America, and to reflect larger spot order sizes. The changes follow a period of feedback and review.

Platts has increased the typical order quantity to 100-1,000 mt from the current 100-500 mt. Price data and information outside of this 100-1,000 mt range may be normalized to this standard.

Platts has also adjusted its normalization matrix as previously proposed to reflect market supply dynamics from Detroit and Baltimore warehouse stocks and Canadian imports.

According to longstanding practice, deals reported as FOB, FCA, for non-Midwest locations or for particularly close or long freights (i.e., less than/greater than the current range of 2.0-2.5 cents/lb) are normalized before inclusion in the Platts Aluminum Transaction premium calculations.

Platts uses a matrix of typical delivery locations throughout North America and categorizes these locations as "average," "close" or "extra" freights based on prevailing market practice. The current average (or basis) locations are: Lafayette, Indiana; Anderson, Indiana; Warrick, Indiana; Berea, Kentucky; Lewisport, Kentucky; Shelbyville, Kentucky; Russellville, Kentucky; St. Louis, Missouri; Carthage, Tennessee; New Johnsonville, Tennessee; and Manitowoc, Wisconsin.

Certain "close" or "extra" freight locations are normalized to "average" based on assigned differential values ranging from plus/minus 0.25 cent/lb to 0.5 cent/lb, which are adjusted periodically based on market feedback on typical locational discounts or extras.

Any further questions or feedback may be directed to Karen McBeth, karen.mcbeth@platts.com, with a cc to pricegroup@platts.com.