Recent geopolitical developments, new mainstream environmental, social and governance standards and changes in consumption habits have led to a need for realignment of brands listed under alloy and standard grade to better reflect those markets.
Fastmarkets is proposing the following:
• Sherritt briquettes move from alloy grade to standard grade. An initial informal consultation with the market in recent months, as well as data collected during pricing sessions, has shown alloy grade market participants are more hesitant to use Sherritt briquettes, because of their shape and concerns in the US market tied to their Cuban origin. Fastmarkets proposes that they remain as a listed brand but designated as standard grade, with market participants in Europe, Asia and other regions willing to accept the material for more standard grade applications.
• Clarification of Vale rounds, putting Vale Port Colborne under alloy grade while Vale Long Harbour is placed under standard grade. Data gathered from pricing sessions shows that Long Harbour often went towards more standard grade applications.
Cobalt brands and which grades they are designated as are under Fastmarkets’ constant review.
As a regulated global price reporting agency, Fastmarkets complies with international trade sanctions and recognizes that several entities no longer deal with Russian brands despite these brands not being sanctioned.
Fastmarkets reviews all pricing data carefully to ensure that its price assessments reflect the “open and competitive” market level. Reporters therefore may apply expert judgement to exclude data deemed unrepresentative or unreliable prior to consideration of the final assessment.
This principle has led to data for Russian brands being discarded or deemed lower confidence in recent months for certain metals, including cobalt. For example, some reported cobalt spot transactions for Russian-origin material were deemed lower confidence and not reflected in recent months.
Duty-clarification
Fastmarkets also proposes to specify the duty status of both standard and alloy grade cobalt metal in Rotterdam. Although there is no EU duty on cobalt, some market participants said clarification of duty-status is important, in case any duty is levied on cobalt metal in the future.
Under this proposal, Fastmarkets would specify standard and alloy grade cobalt as duty-unpaid, customs uncleared.
Where necessary, data that falls within the stated specification ranges for consideration may be normalized to determine the equivalent price for the respective base specification.
The consultation period for this proposed amendment starts from Monday February 6 and will end on Monday March 6. The amendment will then take place, subject to market feedback, on Monday March 13.
To provide feedback on cobalt standard grade, in-whs Rotterdam and cobalt alloy grade, in-whs Rotterdam, or if you would like to provide price information by becoming a data submitter to the cobalt metal price series, please contact Alex Cook and Justin Yang by email at: pricing@fastmarkets.com. Please add the subject heading “FAO: Alex Cook/Justin Yang, re: Cobalt Brand Realignment.”
To see all Fastmarkets’ pricing methodology and specification documents go to
https://www.fastmarkets.com/about-us/methodology.
