SUBSCRIBER NOTE: Platts proposes arbitrage assessments for China met coal, coke indices

S&P Global Platts proposes to start publishing three arbitrage indicator assessments based on existing China Premium Low Vol and metallurgical coke indices.

Platts proposes to launch these weekly price series from September 2016.

These weekly assessments would be:

1) A Premium Low Vol (PLV) Hard Coking Coal (HCC) CFR China (equivalent) assessment that would be a net-forward from the existing domestic China coking coal assessment, including various costs.

Following market feedback, Platts has ascertained market demand for greater visibility on the price differential between the PLV HCC CFR China assessment and its domestic China equivalent.

Its current domestic price assessment, on a DDP Tangshan basis, is published every Wednesday, while the seaborne PLV CFR China price assessment is published daily. Platts DDP Tangshan assessment would be normalized to a CFR China basis, normalizing for payment terms, additional transportation and logistics costs, exchange rate and specifications to reach a port-equivalent value. The assessment would be published on an outright basis and as a price differential to the PLV HCC CFR China price on Wednesday. The new assessments would be published on the same day as the weekly domestic China assessment, starting September 7, 2016.

2) A differential between the CFR Jingtang (equivalent) port stocks assessment and the PLV HCC CFR China assessment.

Following market feedback, Platts has ascertained market demand for greater visibility on the price differential between seaborne cargo prices and the port stock market. The port stock (CFR Jingtang) assessment is published every Friday, while the seaborne PLV CFR China price assessment is published daily. The new assessment would be published every Friday, starting September 9, 2016.

3) A metallurgical coke Platts FOB North China (equivalent) assessment that would be a net-forward from the existing domestic DDP China coke assessment, including various costs.

Platts has ascertained market demand for greater visibility on the price difference between domestic coke and China export values. Platts domestic coke assessment is carried out on a DDP Tangshan basis every Thursday. This assessment would be normalized for payment terms, logistics cost, exchange rate and specifications, to a FOB North China basis. The assessment would be published on an outright basis and as a price differential to the Platts 64/62% CSR Metallurgical Coke FOB North China assessment. This would be published from September 8, 2016.

Please send any feedback on this proposal by July 27, 2016 to annalisa.jeffries@spglobal.com, Edwin Yeo, edwin.yeo@spglobal.com, copying in pricemethodology@spglobal.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.