Clarification on NWE ethanol nomination procedures

Platts European T2 FOB Rotterdam ethanol assessments reflect standard, transactable size of 1,000-2,000 mt. While the Platts T2 ethanol assessments reflect a barge market, parties involved in transactions may also opt to load on a vessel, do pump overs or perform ship-to-ship transfers. A buyer may opt to nominate a vessel instead of a typical 2,000-4,000 mt barge, provided the physical dimensions of the performing vessel comply with the requirements of the designated port.

Should a buyer opt to nominate a vessel and delay in loading occurs, the seller will face demurrage exposure limited to the typical transactable barge size, while the buyer will face demurrage costs consequential to his choice of vessel. For example, if the sale was done for 3,000 mt and the buyer nominates a 12,500 mt vessel, the seller will incur demurrage cost for 3,000 mt, while the buyer will face the demurrage cost of the remaining 9,500 mt. In this instance leading to a consequential demurrage cost, the seller must show good endeavor and not willfully obstruct the timely loading process in order to disadvantage the buyer.

For queries please contact Ilana Djelal, ilana_djelal@platts.com and Guilherme_Kfouri@platts.com with copy to petchems@platts.com and pricegroup@platts.com.