PRICING NOTICE: Proposal to discontinue iron ore implied pellet premium to 62% Fe fines

Fastmarkets proposes to discontinue its iron ore implied pellet premium over 62% Fe fines, cfr Qingdao, $/tonne [MB-IRO-0080].

Fastmarkets’ implied pellet premium over 62% Fe fines tracks the differential between its cfr Qingdao 65% Fe blast furnace pellet index [MB-IRO-0012] and the weekly average of its cfr Qingdao 62% Fe fines index [MB-IRO-0008].

The discontinuation of this implied premium price is proposed due to a shift in most global pellet contracts to referencing the 65% Fe fines index since 2019.

Fastmarkets’ implied pellet premium over the 65% Fe fines, cfr Qingdao, $/tonne [MB-IRO-0150] will continue to be published to reflect the differential between its cfr Qingdao 65% Fe blast furnace pellet index [MB-IRO-0012] and the weekly average of its cfr Qingdao 65% Fe fines index [MB-IRO-0009].

Note however that this reference is reflective of the pellet premium on a cfr China basis, where India-origin cargoes comprise the majority spot market liquidity. It does not necessarily reflect the value associated with contracts in other regions, where spot trade is scarce and where pellet premiums are typically negotiated bilaterally between counterparties on a quarterly basis.

The consultation period for the discontinuation of these prices starts from Monday May 4 and will end on Friday May 29. The amendment will take place, subject to market feedback, on Friday June 5.

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 Peter Hannah by email at: pricing@fastmarkets.com. Please add the subject heading FAO: Peter Hannah, re: pellet premium.

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

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