SUBSCRIBER NOTE: Platts to publish US coking coal quality penalties and premia

Following industry feedback, Platts intends to start publishing from May 12 penalties and premia differentials for US low-vol hard coking coal, expanding on the existing publication of quality differentials basis Premium Low-Vol FOB Australia. The assessed values would reflect price adjustments in specified ranges from Platts base specification for coke strength after reaction and sulfur, ash and moisture. The penalty and premia values would be assessed as a percentage of the prevailing total price assessed daily for US low-vol HCC, which will take into account observed HCC trades and value in use for users producing metallurgical coke for a typical blast furnace. CSR and sulfur values will be split into two bandings to allow different ratios to be applied depending on where values are observed and how sensitive buyers are to them as part of overall VIU analysis. CSR will be split between a 50-64% band, with one ratio given for use as penalty premia based against a 1 percentage point change in CSR in that band against the Platts low-vol specification which will normalize to 58% CSR, and a further ratio for 40-49%. Sulfur will be split between 0.7-1.05% and 1.06-1.25%, with a price ratio given for a 0.1 percentage point change between each range specified. Ash in a 5-10% range will be given a penalty premia ratio based on a 1 percentage point change in the band. Total moisture at 6-11% will also be given a penalty premia ratio based on a 1 percentage point change in the band. The differentials will be published in Platts Metals Alert and SBB Steel Markets Daily. All comments and questions should be addressed via email to Hector Forster, hector.forster@platts.com, with a CC to cokingcoal@platts.com and pricegroup@platts.com.