SUBSCRIBER NOTE: Platts proposes changes to FOB China HRC steel assessment

Platts is inviting industry feedback on a proposal to increase the frequency of assessment for the hot-rolled coil steel FOB China price assessment (STHRZ02) to daily, effective May 25, 2015. The assessment is currently published weekly on Thursdays.

The proposal reflects the growth in China's HRC exports sold on a spot basis. Chinese exports have gained in pricing importance as they influence export and domestic prices of other countries in the region.

At the same time, Platts is consulting with the industry on its proposal to clarify the assessment's specifications to SS400 or equivalent coil of 3 mm thickness and 1,200-1,500 mm width. The location basis specified will be FOB Tianjin, and the cargo size will be 5,000 mt. Payment terms will be L/C at sight. Cargoes for shipment between one to two months forward from the date of publication would be considered for assessment.

Platts is also seeking market feedback on its proposal to publish a new assessment reflecting the premium that SAE1006 or equivalent coil 2 mm thick commands over SS400 coil of the specifications clarified above. The premium will be derived from Platts assessment of SAE1006 coil, normalized to the same location, quantity, cargo size and payment terms specified for the SS400 assessment. It will be published daily.

Platts will consider for assessment deals, bids and offers for cargoes of other qualities and sizes, and loading from other Chinese ports, and normalize them to the standard specifications.

Normalization for quality, dimensions and cargo size will be done based on current premiums and discounts applied by the market, and locational normalization will utilize freight differentials between ports along China's coast, as well as freight netbacks and forwards. Information about known tax rebates will also be considered in the assessment process.

The assessments will follow the Chinese public holiday calendar, with the exception of Saturdays and Sundays designated as working days in lieu of certain weekday holidays, because trading activity with counterparties overseas tends to be limited.

Please send all feedback, queries and comments by April 22 to keith.tan@platts.com and pricegroup@platts.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.