SUBSCRIBER NOTE: Platts proposes changes to CFR China soybeans methodology

S&P Global Platts is proposing to change its CFR China soybeans assessment methodology, including the assessment timing, as well as launch a further forward Soybeans CFR China assessment and equivalent Yuan/mt prices, effective June 3, 2019, to better reflect spot market activity amid changing trade flows.

CHANGE IN TIMING: Platts is proposing that its SOYBEX CFR China assessment and related basis assessment Soybeans CFR China M1 reflect cargoes shipping one calendar month forward, from June 3. This will be basis Brazil shipment time into North China, and shipments from all other locations may be normalized to this timing basis. The SOYBEX CFR China assessment and related basis assessment currently reflect cargoes arriving into North China four months forward.

Platts is also proposing to launch an additional Soybeans CFR China calendar month M2 assessment as a basis to the Chicago Board of Trade (CBOT) soybeans futures price in cents/bushel with the corresponding futures contract month letter code appearing next to the basis value, and a flat price equivalent in USD/mt, which would reflect cargoes shipping two calendar months forward.

CHANGE IN ROLL DATES: In addition, Platts is proposing to roll its SOYBEX CFR China assessment and Soybeans CFR China assessments to the following calendar month on the 16th of the current month unless that day is not a business day, in which case the assessment rolls over on the next business day, effective June 3. Currently, it is rolled to the next forward calendar month on the first day of each month.

For example under the proposed change, from July 16-August 15, the SOYBEX CFR China value would reflect cargoes shipping in September, while from August 16-September 15, the SOYBEX CFR China value would reflect cargoes shipping in October.

Over the same period, from July 16-August 15, the Soybeans CFR China M1 assessments would reflect cargoes shipping in September while the Soybeans CFR China M2 assessments would reflect cargoes shipping in October. From August 16-September 15, the Soybeans CFR China M1 assessments would reflect cargoes shipping in October while the Soybeans CFR China M2 assessments would reflect cargoes shipping in November.

NEW YUAN/MT ASSESSMENTS: Platts is also proposing to launch equivalent Yuan/mt Soybeans CFR China M1 and M2 assessments, using the daily Bank of China US dollar/Chinese Yuan rate.

Platts would also like to clarify that its SOYBEX CFR China and related basis assessments reflect Brazil soybean specification, as per ANEC 41 and 42 Brazilian soybeans quality clause, with oil content of 18.5% and a standard protein level of 34.5%. Shipments reflecting other specifications may be normalized to this basis.

All other aspects of the CFR China soybeans methodology will remain unchanged, including the assessment basis of CFR North China and the typical cargo size of 60,000 mt with 10% operational tolerance.

Please send all feedback or questions by May 10, 2019 to asia_ags@spglobal.com and pricegroup@spglobal.com.

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