SUBSCRIBER NOTE: Platts changing thermal coal netback methodology

S&P Global Platts will revise the methodology for the thermal coal netback for FOB US East Coast and will launch two new netbacks reflecting the value for thermal coal FOB US Gulf Coast and FOB Vancouver.

For the FOB US East Coast netback (Platts symbol COUSC00), Platts will change the heat content from 6,500 NAR kcal/kg to 12,500 Btu/lb GAR to better reflect available US domestic thermal coals for export. In addition, Platts will make the heat conversion from the delivered price minus freight. The heat conversion is currently made from the delivered price.

FOB US Gulf Coast (basis 11,500 Btu/lb GAR, 5 lbs SO2/MMBtu) will show the price of thermal coal compared to CIF ARA coal (basis 6,000 kcal/kg NAR, 1% sulfur) minus the Panamax freight rate from Mobile, Alabama, to Rotterdam, adjusted for heat and sulfur and converted to $/st.

The sulfur adjustment will be based on a new daily assessment that will be published alongside the FOB US Gulf Coast netback. The sulfur assessment will reflect the value of one-tenth of one percent of sulfur per short ton for thermal coal destined for Northern Europe.

FOB Vancouver (basis 8,800 Btu/lb GAR, 0.8 lbs SO2/MMBtu) will show the price of thermal coal compared to CIF Japan coal (basis 6,000 kcal/kg NAR, 1% sulfur) minus the Panamax freight rate from Roberts Bank, British Columbia to Japan, adjusted for heat and converted to $/st.

The netbacks will publish daily in Coal Trader and Coal Trader International, and are scheduled to launch October 3.

Please address any questions or comments to coal@platts.com and pricemethodology@platts.com.