Metals & Mining Theme, Ferrous, Non-Ferrous

August 25, 2023

Platts proposes PBL, NBL iron ore China port stock lump assessments to complement IOPEX

Following industry consultation, Platts, part of S&P Global Commodity Insights, is proposing to launch two new daily Chinese iron ore port stock price assessments for Australian Newman Blend Lump (NBL) on a free-on-truck North China ports basis and Australian Pilbara Blend Lump (PBL) on a free-on-truck East China ports basis, effective Oct. 16, 2023, further complementing the expansion of its suite of IOPEX assessments.

The proposal is in response to rising traction in the Chinese portside market and industry demand for assessments for mainstream lumps. Platts earlier carried out an industry consultation, announced here: https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/120522-platts-opens-consultation-on-iopex-domestic-chinese-iron-ore-port-stock-indices.

Platts has observed significant production volume and port stocks for NBL and PBL in North and East China, which constitute a material share of Chinese port stock trade volumes. Miners BHP and Rio Tinto announced rising lump sales volume in the first half of 2023 at 38 million mt and 35.9 million mt, respectively, up by 2.9% and 7.5% year-on-year.

The new NBL assessment would reflect trading activity in Caofeidian and Jingtang in Northern China. The new PBL assessment would reflect trading activity in Rizhao and Qingdao in Eastern China. Platts may consider pricing information for cargoes delivered to other northern and eastern ports in the assessment, after normalization to the stated location basis. The proposed assessments would be published in Yuan/wmt, on an FOT basis.

Platts is also proposing to launch an import parity price (IPP) calculation for NBL in North China and PBL in East China, respectively, in $/dmtu, accounting for the moisture content, exchange rate, port charges and value added tax.

The proposed assessment specifications are:

Assessment Frequency Quality Quantity Incoterms Location Timing Payment UOM
Newman Blend Lump FOT North China Daily Reflecting the typical specifications of the seaborne equivalent, incorporating changes arising from producers' periodic specifications updates min 5,000 mt FOT Caofeidian, Jingtang Prompt loading TT/CAD Yuan/wmt
Pilbara Blend Lump FOT East China Daily Reflecting the typical specifications of the seaborne equivalent, incorporating changes arising from producers' periodic specifications updates min 5,000 mt FOT Rizhao, Qingdao Prompt loading TT/CAD Yuan/wmt
Newman Blend Lump IPP North China Daily 62.5% Fe, 4% moisture, 3.5% silica, 1.5% alumina, 0.075% phosphorus, 0.02% sulfur min 5,000 mt FOT Caofeidian, Jingtang Prompt loading TT/CAD $/dmtu
Pilbara Blend Lump IPP East China Daily 62.5% Fe, 4% moisture, 3.5% silica, 1.5% alumina, 0.075% phosphorus, 0.02% sulfur min 5,000 mt FOT Rizhao, Qingdao Prompt loading TT/CAD $/dmtu

The assessments would consider market information reported to Platts and published through the day, including firm bids and offers, transactions and indications, as well as any other information deemed relevant to the assessment process.

Full description of the Platts assessments methodology and data hierarchy can be found here: https://www.spglobal.com/platts/plattscontent/_assets/_files/en/our-methodology/methodology-specifications/platts-assessments-methodology-guide.pdf.

The assessments would be published on fixed page 0120 of the real-time Platts Steel Alert and Platts Metals Alert, in SBB Steel Markets Daily, on Platts Dimensions Pro, in Platts Market Center and in the Platts price database.

Platts invites feedback on this proposal to IODEX@spglobal.com and pricegroup@spglobal.com by September 13, 2023. 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.