S&P Global Platts will reflect a volume range of 4,000 mt to 6,000 mt, with a base standard of 4,000 mt, for its FOB NWE Seagoing Butane (PMAAL00) assessment with effect from January 2, 2020.
Platts has observed that typical parcels trading in this market are above 4,000 mt, and has received feedback that the current parcel sizes reflected in the assessment are no longer the most fungible. While smaller parcel trades have been observed, these are typically loaded on to larger vessels wherein the cost of unused freight affects the value of the trade.
The assessment currently reflects a range of full or part cargoes from 1,800 mt to 6,000 mt with no basis size. The Butane NWE CIF assessment would remain unchanged, reflecting full or part cargoes of 1,000 to 3,600 mt.
Under this proposal, only trades for parcels within the 4,000 mt to 6,000 mt range would be reflected in the assessment, with trades for larger sizes normalized to the basis volume of 4,000 mt for assessment purposes.
This decision follows a period of industry feedback. This change was first proposed in a note published October 11: https://www.spglobal.com/platts/en/our-methodology/subscriber-notes/101119-pl atts-proposes-changes-to-volume-range-basis-for-fob-nwe-seagoing-butane-assess ment
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