After a consultation, which closed on Thursday November 2, along with data examination, Fastmarkets will amend the base chrome to iron ratio in its chrome ore South Africa UG2/MG concentrates index, cif China to 1.3:1, from 1.27:1.
In the calculation of the index, if price data is received for material with chrome to iron ratios different from that of the index basis, this is normalized using in-house developed models based on regression analysis.
The change in the base chrome to iron ratio is aimed at increasing the predictability of the index calculation by helping to reduce the degree of normalization required to adjust prices for the most liquid products to the index base specification.
Fastmarkets will not proceed with the proposal to expand the range of ratios accepted to include 1.37:1 on the upper end, from 1.35:1 currently, because of a lack of clear support.
The changes to the specification will be as follows:
MB-CHO-0003 Chrome ore South Africa UG2/MG concentrates index, cif China, $/tonne
Quality: Up to 2mm (99% min); Cr range 40-42%; Silica max 6%; Alumina max 18%; MgO max 16%; P max 0.01%; S max 0.01%; chrome iron ratio 1.27:1-1.35:1, basis 1.3:1
Quantity: Min 5,000 tonnes
Location: cif Tianjin, China (normalized for any Chinese mainland sea port)
Unit: USD per tonne
Payment terms: Payment at sight
Publication: Weekly. Tuesday 2-3pm London time
Notes: Bulk (container deals normalized)
This price is a part of the Fastmarkets ores & alloys physical prices package.
Fastmarkets’ index methodology screens outliers and applies a quantity-weighted model to ensure that the chrome ore South Africa UG2/MG concentrates index, cif China is the most robust in the industry. Fastmarkets 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, please contact Claire Patel Campbell by email at: pricing@fastmarkets.com. Please add the subject heading “FAO: Claire Patel-Campbell, re: UG2/MG chrome ore index.” Please indicate if comments are confidential. Fastmarkets will consider all comments received and will make comments not marked as confidential available upon request.
To see all Fastmarkets’ pricing methodology and specification documents go to https://www.fastmarkets.com/methodology.
