PRICING NOTICE: Proposal to amend Fastmarkets’ cif Shanghai ferro-chrome index

Fastmarkets proposes to change its cif Shanghai ferro-chrome index to a single-figure price assessment and change the location from Shanghai to main Chinese ports

Subject to market feedback, Fastmarkets will change the specification of the ferro-chrome index 50% Cr import, cif Shanghai, $/Ib

Consolidation in the ferro-chrome market means the number of sell-side data sources has fallen since Fastmarkets started its ferro-chrome index in 2012.

Indices – tonnage-weighted average calculations – best work in liquid markets that can reliably contribute sufficient robust indications to the calculation.

The lower volume of data points in relation to the imported ferro-chrome market in China has made the use of an index less suitable. Low availability of data and the calculation process in an index mean the price is more susceptible to being moved by low volume of trade information than if it was an assessment.

Illiquid markets with a relatively low number of participants are more accurately reflected as an assessment.

Therefore, Fastmarkets proposes to use an assessment process rather than an index.

Fastmarkets proposes a single-figure assessment rather than a range because a single price provides simplicity to the market and cohesion for users.

Additionally, Fastmarkets proposes to amend the delivery port from “Shanghai (other ports normalized)” to “Main Chinese ports”. This proposal reflects that Shanghai is not currently a major destination port for imported ferro-chrome in China.

The proposed specification is as follows:

Assessment: Ferro-chrome 50% Cr import, cif main Chinese ports, $/Ib contained Cr
Quality: 10-100mm lump. Chrome base 50%, range 48-52%; carbon base 7%, max 9%; silicon base 3%, max 6%; phosphorous max 0.03%; sulfur max 0.06%
Quantity: Min 1,000 tonnes minimum
Location: cif main Chinese ports
Timing: Within 6 weeks
Unit: USD per lb
Payment terms: LC at sight
Publication: Weekly. Friday 3pm London time
Notes: Seaborne, all origins.
Data history from May 2012

The consultation period for this proposed amendment will end one month from the date of this pricing notice, on December 2, with changes taking place, subject to market feedback, from December 6.

To provide feedback on this price or if you would like to provide price information by becoming a data submitter to this price, please contact Jon Stibbs by email at: pricing@fastmarkets.com. Please add the subject heading FAO: Jon Stibbs, re: Ferro-chrome index.

To see all Fastmarkets’ pricing methodology and specification documents go to https://www.fastmarkets.com/about-us/methodology.

What to read next
Fastmarkets proposes to amend the name of the MB-AL-0231 Aluminium P1020A all-in price, delivered Midwest US, US cents/lb to clarify that the price is based on the London Metal Exchange cash aluminium price.
The publication of Fastmarkets’ Vietnamese steel scrap import assessments for Friday June 14 were delayed because of a reporter error. Fastmarkets’ pricing database has been updated.
In the open consultation, Fastmarkets FOEX did not propose any changes, and there was no feedback received during the process. No material changes were made to the current methodology. A newly dated methodology document has been posted here.
The publication of Fastmarkets’ aluminium scrap and secondary aluminium ingot price assessments for Wednesday June 12 were delayed because of a reporter error. Fastmarkets’ pricing database has been updated.
The publication of Fastmarkets’ MB-IRO-0186 iron ore DR grade pellet premium indicator for Wednesday June 12 was delayed due to an error in the review process.
Fastmarkets proposes to discontinue its weekly price assessments for AG-UCO-0013 UCO, Chinese flexi-tank, CFR Antwerp, Rotterdam, Amsterdam, and AG-UCO-0012 UCO, Chinese bulk, CIF Antwerp, Rotterdam, Amsterdam.