Platts to change Southeast Asia biodiesel assessment time, laycan, from July 1

S&P Global Platts has decided to change the closing time and assessed laycan for its biodiesel FOB Southeast Asia assessment, as well as its calculation of the palm oil-gasoil spread, effective July 1, 2020.

Platts first proposed this change in a subscriber note published April 29: https://www.spglobal.com/platts/en/our-methodology/subscriber-notes/042920-platts-proposes-to-change-southeast-asia-biodiesel-assessment-time-laycan-jul-1

Platts is changing the closing time of its assessment to reflect the timing that is most relevant in its physical market assessment, and has observed and received market feedback that physical market activity in the Asia biodiesel market typically occurs later in the day, in line with the upstream crude palm oil market. In addition, the bulk of the regional biodiesel market typically trades further forward and in monthly cycles, according to market feedback.

CHANGE IN ASSESSMENT CLOSE: From July 1, the Platts biodiesel FOB Southeast Asia assessment will reflect the prevailing market value at 6:00 pm Singapore time (1000 GMT), from the current time stamp of 4:30 pm Singapore time. In line with this change, Platts will assess the value of the Bursa Malaysia crude palm oil futures (M1, M2 and M3) and the PO-GO, or palm oil-gasoil spread, at 6:00 pm Singapore time from July 1, instead of 4:30 pm currently.

CHANGE IN PO-GO CALCULATION: Platts has also decided to reflect the value of the third forward month in its PO-GO spread from July 1, i.e. the spread between the third forward month of the Bursa Malaysia crude palm oil futures and the third forward month of the ICE gasoil futures. Currently, the PO-GO spread reflects the prompt Bursa Malaysia crude palm oil futures versus the prompt ICE gasoil futures. Platts understands that the market typically uses the third month PO-GO spread to gauge discretionary blending demand further forward. To derive the PO-GO spread value, Platts will launch an assessment of third month ICE gasoil futures and a USD.MYR foreign exchange assessment, both reflecting value at 6:00 pm Singapore time. The existing ICE gasoil futures value and USD.MYR foreign exchange assessment, timestamped at 4:30 pm Singapore time, will continue to be published separately.

CHANGE IN BIODIESEL ASSESSMENT LAYCAN: Platts has also decided to start reflecting parcels loading one calendar month forward in its biodiesel FOB Southeast Asia assessment from July 1, from 15-30 days forward currently. The proposed assessment laycan will roll to the next calendar month on the first publication day after the 14th of each month. For example, from September 15-October 14, the assessment will reflect parcels loading in November. The assessment will roll to December cargoes from October 15. Other assessment parameters of the Platts biodiesel FOB Southeast Asia price will remain the same, such as specification, volume and basis ports.

The following existing assessments are affected by the changes:

These assessments appear on Platts Biofuel (PBF) Alert pages 2, 2010 and 2310, in the Platts Biomass-based Diesel Report and Platts BiofuelScan, as well as in the Platts price database under the codes above. Please send any further questions and feedback to asia_ags@spglobal.com and pricegroup@spglobal.com.

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