Platts reconsiders proposal to launch PLV coking coal FOB US netback calculation

Following market feedback, Platts, part of S&P Global Commodity Insights, will not introduce a new Premium Low Vol (PLV) HCC FOB US netback price as proposed in earlier subscriber notes. Platts will instead continue to monitor the growing trade flow between the US and Asia and expand heards publishing of regional coal price differentials.

The decision not to implement the proposal follows feedback of continued US spot trade linkage to Platts Asia-Pacific benchmarks for PLV coking coal and market preference to consider a range of freight rates to determine US FOB and CFR met coal spot pricing into Asia.

Platts on Sept. 1 proposed publishing a calculated netback price basis Platts Premium Low Vol HCC CFR India Net Forward to the US East Coast, using Platts Met Coal Dry Bulk Freight US-India for the freight component, after observing increasing volumes of metallurgical coal from the US exported into India and Southeast Asia.

The feedback period was subsequently extended on Oct. 12 to gather more information from market participants.

Market feedback indicated that US met coal spot trades to India use a mix of references, including PLV FOB Australia and published and negotiated freight adjustments to a CFR India net forward or FOB US netback basis.

Meanwhile, PLV-quality coals from the US have recently expanded spot sales into India. US PLV-quality coals are primarily sold in Atlantic markets and to Japan, South Korea and China. Pricing terms are typically based on Platts PLV FOB Australia and Platts PLV CFR China references, with freight adjustments.

Full details about the proposal and extension of the feedback period can be found here:

https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/090123-platts-proposes-to-launch-daily-plv-coking-coal-fob-us-netback-calculation

https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/101223-platts-extends-feedback-period-for-proposed-launch-of-plv-coking-coal-fob-us-netback-calculation

Platts continues to monitor regional spreads as part of its APAC and Atlantic met coal coverage.

Platts existing Atlantic met coal coverage includes publication of daily FOB US East Coast spot price assessments for Low Vol HCC, High Vol A and High Vol B hard coking coals.

Platts Atlantic Met Coal assessments are published in Steel Markets Daily, Coal Trader International, Coal Trader and can be accessed via Platts Connect.

Please send questions and comments to PL_CokingCoal@spglobal.com and pricegroup@spglobal.com.

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