Proposal to amend Fastmarkets’ MHP price name and specifications

Fastmarkets proposes to amend the name of its nickel mixed hydroxide-precipitate expressed price assessment and to amend the nickel content specifications to reflect the market more closely.

The consultation period for these proposed amendments starts from Thursday January 12, and will end on Monday February 13. The amendments will then take place, subject to market feedback, on Friday February 17.

Name change
Fastmarkets proposes to amend the name of the nickel mixed hydroxide-precipitate expressed price to nickel mixed hydroxide-precipitate outright price, cif China, Japan and Korea, $/tonne in order to more clearly distinguish the separation between the two prices.

Currently, Fastmarkets publishes two price assessments, a payable indication linked to the London Metal Exchange and an expressed price, which reflects the value of MHP as an outright price.

Fastmarkets initially launched these two prices as a way to reflect the market in two different ways, with the expressed price being a reflection of the payable assessment. From October 28, 2022 to December 6, 2022 the payable assessment was applied to the previous LME monthly average to calculate the expressed price.

Starting December 16, however, a growing number of participants have begun to calculate the value of MHP using alternative pricing mechanisms, decoupled from the LME nickel price. The emergence of outright trades, bids and offers using this method of pricing has meant that the two prices have now decoupled.

Due to this shift, Fastmarkets proposes to alter the use of “expressed” in the price name to “outright” to clearly differentiate the two price assessments and remove confusion for the market.

Changes to nickel content specifications
Fastmarkets proposes to increase the nickel content of the specifications to 30-45% from 30-40% following feedback that the current range may result in spot cargos falling outside of our assessment.

The proposed increase in the nickel content range will allow for more future liquidity to be included in price assessments.

The proposed changes are as follows in bold:
MB-NIO-0003 Nickel mixed hydroxide precipitate outright price, cif China, Japan and South Korea, $/tonne
Quality: 30-45% nickel min/max, 1-6% cobalt min/max, 4% Zn max, 4% Cu max, 9% Mn max, 5% Mg max, 5% S max, 0.5% Fe max, moisture content 35-40%
Quantity: min 100 tonnes
Location: cif major ports China, Japan and South Korea (other ports normalized)
Timing: 45 days
Unit: USD per tonne, inferred basis the payable range or expressed by participants
Publication: Weekly, Friday 3-4pm London time.

MB-NIO-0004 Nickel mixed hydroxide precipitate payable indicator, % London Metal Exchange, cif China, Japan and South Korea
Quality: 30-45% nickel min-max, 1-6% cobalt min-max, 4% Zn max, 4% Cu max, 9% Mn max, 5% Mg max, 5% S max, 0.5% Fe max, moisture content 35-40%
Quantity: min 100 tonnes
Location: cif major ports China, Japan and South Korea (other ports normalized)
Timing: 45 days
Unit: % payable basis LME monthly average
Publication: Weekly, Friday 3-4pm London time

All other specifications of the price assessments will be unaffected by these proposals.

To provide feedback on these proposals, or if you would like to provide price information by becoming a data submitter to these prices, please email pricing@fastmarkets.com. Please add the subject heading “FAO: Callum Perry, re MHP price specification.”

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

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