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The proposal follows market feedback requesting a more frequent reference.
Metal Bulletin is therefore proposing the introduction of a Daily fob China HRC Index for Q235/SS400 HRC material in widths of 1,250-1,800mm, and thicknesses of 3-14mm, with payment terms of letter of credit on sight, for trading volumes of more than 1,000 tonnes.
This will replace the weekly assessment of the fob China HRC price.
As China’s HRC export price is an important factor in overseas consumers’ procurement decisions, and has a high reference value for steelmakers of other Asian regions in pricing relevant products, the proposed change is intended to ensure that Metal Bulletin’s prices track the market closely, because of the current high volatility in the Chinese domestic market.
A transaction-based index methodology is thought to be the most robust mechanism to reflect the behaviour of this market reliably, and would fulfil requests from market participants for an objectively calculated price.
The consultation period for this proposed change will end one month from the date of this pricing notice, on October 8, with the first official price for the index scheduled for publication on October 16.
Metal Bulletin’s index methodology screens outliers and applies a quantity-weighted model to ensure that the fob China HRC price is the most robust in the industry.
Metal Bulletin has no financial interest in the level or direction of the index.
To provide feedback on this index, or if you would like to provide price information by becoming a data submitter to this index, please contact Gladdy Chu by email at: pricing@metalbulletin.com. Please add the subject heading FAO: Gladdy Chu, re: the fob China HRC index.
To see all Metal Bulletin’s pricing methodology and specification documents, go to https://www.metalbulletin.com/prices/pricing-methodology.html.