Platts updates proposal for methodology specifications of Atlantic metallurgical coal assessments

Platts, part of S&P Global Energy, is updating the original proposal to amend the methodology specifications of its Atlantic metallurgical coal assessments by dropping the proposed minimum coke strength after reaction specification and extending the feedback deadline and implementation date.

Based on initial feedback received in response to its Oct. 13 proposal, available here, Platts is maintaining its proposal to add Baltimore as an additional basis location and is postponing the proposed implementation to Feb. 1, 2027. Additionally, Platts maintains its proposal to discontinue the penalty and premia assessments for seaborne hard coking coals, effective Feb. 1, 2027.

Following initial market feedback, Platts is no longer proposing to introduce a minimum CSR for both high-volatile hard coking coal A and high-vol hard coking coal B.

Other proposals remain unchanged as outlined below.

Inclusion of Baltimore alongside Hampton Roads

Platts proposes to include Baltimore alongside Hampton Roads in the location specifications for its low-vol, high-vol A and high-vol B hard coking coal FOB USEC assessments.

The proposal applies to the following assessments:

All other specifications would remain unchanged.

Normalization approach for Quality Specifications

Platts may consider and apply appropriate normalizations for cargoes that do not meet the standard specifications for the purpose of the assessments.

For instance, bids, offers and trades for Atlantic high-vol A, high-vol B and low-vol HCC metallurgical coals may be normalized against the standard specifications by applying the prevailing value adjustment for every 1% variation in any quality specifications, including but not limited to TM, ash, sulfur, VM and fluidity.

An example of proposed normalization:

A high-vol A cargo is reported at $190/metric ton FOB Baltimore/Hampton Roads with:

Ash: 7%

TM: 9%

Platts would normalize the cargo to the high-vol A specifications of 7.5% ash and 8% TM.

Assuming a prevailing adjustment factor of 10 cents/mt per 1% variation:

Ash (0.5% better than specification): minus 5 cents/mt

TM (1% worse than specification): plus 10 cents/mt

Net adjustment: plus 5 cents/mt

The normalized value would therefore be $190.05/mt FOB, rounded to the nearest 50 cents/mt ($190/mt FOB).

Following a review of market feedback and observed trading activity, Platts is not proposing any new mid-vol HCC assessments or introducing brand-based relativities at this time due to a lack of broader market support and limited spot liquidity. Platts will continue to monitor market developments and reassess the need for additional assessments as appropriate.

Platts will continue to consider mid-vol hard coking coal bids, offers and trades for its low-vol HCC assessment by applying appropriate normalization.

Discontinuation of penalty, premia assessments for seaborne HCC

Platts also proposes to discontinue the penalty and premia assessments for seaborne hard coking coals and its underlying calculations, as it proposes to implement value-adjusted normalization going forward.

The discontinuation will impact the following assessments and calculations:

Full specifications for Platts metallurgical coal assessments can be found in the Global Metallurgical Coal Specifications Guide, available here.

The US metallurgical coal assessments are published in SBB Steel Markets Daily, Coal Trader International, Coal Trader, and on fixed page STL1049. The assessments can also be accessed through S&P Global Energy Core.

Please send any questions, comments or feedback by Nov. 30 to EMEAMetalsTeam@spglobal.com and pricegroup@spglobal.com

For written comments, please provide a clear indication if they are not intended for publication by Platts for public viewing.

Platts will consider all comments received and make those not marked as confidential available upon request.