Fastmarkets is proposing to introduce fallback measures to its two Chinese vanadium fob price assessments amid a significant drop in spot liquidity in China’s vanadium export market.
Since the second half of 2019, Chinese exporters’ interest in shipping vanadium products abroad has been stifled because Chinese prices have been much higher than their European counterparts, which has persisted so far this year, especially with regional differences in industrial recovery after the Covid-19 pandemic.
In light of this, Fastmarkets has proposed to launch two weekly Chinese domestic price assessments for vanadium products to better monitor the Asian country’s domestic market change.
Meanwhile, the continued assessments of China’s fob market with the introduction of fallback measures in the low-liquidity environment should enable market participants to closely monitor the opportunity for export and import business.
As such, in the absence of spot trades either reported directly or second hand, Fastmarkets will apply the fallback measure, namely, to convert Chinese domestic vanadium prices into their theoretical fob equivalents, using its own assessments of the domestic market and formula that has been widely adopted by market participants.
Specifically, in the low-liquidity circumstances, the ferro-vanadium 78% V min, fob China will be converted basis vanadium nitrogen, basis 77%V, 16% N, ex-works China price.
The vanadium pentoxide 98% V2O5 min, fob China price will be inferred basis vanadium pentoxide 98% V2O5 min, ex-works China.
The specifications for the related two vanadium fob prices are as follows with proposed inclusion of low-liquidity measures in italics:
MB-FEV-0003 Ferro-vanadium 78% V min, fob China, $/kg V
Quality: Lump. V 78% min, Al 1.5% max, Si 2% max, C 0.06%, S 0.05%, P 0.05%, As 0.06%, Mn 0.5%, Cu 0.1%, Ni 0.15%, Mesh size 10-50mm, 90% min.
Quantity: Min 5 tonnes (+/- 5%)
Location: fob China (other delivery terms normalized)
Timing: Within 20 days
Unit: $/kg V
Payment terms: L/C, T/T, other payment terms normalized
Publication: Weekly, Thursday 2-3pm London time
Note: Low-liquidity measures are applied when necessary
MB-V-0002 Vanadium pentoxide 98% V2O5 min, fob China, $/lb V2O5
Quality: Brown flake. V 98% min, Si, 0.25% max, Fe 0.30% max, S 0.03% max, P 0.05% max, As 0.02% max, Na2+K2O 1.50% max.
Quantity: Min 5 tonnes (+/- 5%)
Location: fob China (other delivery terms normalized)
Timing: Within 20 days
Unit: $/lb V2O5
Payment terms: L/C, T/T, other payment terms normalized
Publication: Weekly, Thursday, 2-3pm London time
Note: Low-liquidity measures are applied when necessary
The consultation period for this proposed change will end one month from the date of this pricing notice, on Tuesday October 20. Subject to further feedback, the change will take place on Thursday October 22.
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 Amy Lv by email at: pricing@fastmarkets.com. Please add the subject heading ‘FAO: Amy Lv, re: fallback procedures for Chinese vanadium fob prices.
To see all Fastmarkets’ pricing methodology and specification documents, please go to www.fastmarkets.com/about-us/methodology
In light of this, Fastmarkets has proposed to launch two weekly Chinese domestic price assessments for vanadium products to better monitor the Asian country’s domestic market change.
Meanwhile, the continued assessments of China’s fob market with the introduction of fallback measures in the low-liquidity environment should enable market participants to closely monitor the opportunity for export and import business.
As such, in the absence of spot trades either reported directly or second hand, Fastmarkets will apply the fallback measure, namely, to convert Chinese domestic vanadium prices into their theoretical fob equivalents, using its own assessments of the domestic market and formula that has been widely adopted by market participants.
Specifically, in the low-liquidity circumstances, the ferro-vanadium 78% V min, fob China will be converted basis vanadium nitrogen, basis 77%V, 16% N, ex-works China price.
The vanadium pentoxide 98% V2O5 min, fob China price will be inferred basis vanadium pentoxide 98% V2O5 min, ex-works China.
The specifications for the related two vanadium fob prices are as follows with proposed inclusion of low-liquidity measures in italics:
MB-FEV-0003 Ferro-vanadium 78% V min, fob China, $/kg V
Quality: Lump. V 78% min, Al 1.5% max, Si 2% max, C 0.06%, S 0.05%, P 0.05%, As 0.06%, Mn 0.5%, Cu 0.1%, Ni 0.15%, Mesh size 10-50mm, 90% min.
Quantity: Min 5 tonnes (+/- 5%)
Location: fob China (other delivery terms normalized)
Timing: Within 20 days
Unit: $/kg V
Payment terms: L/C, T/T, other payment terms normalized
Publication: Weekly, Thursday 2-3pm London time
Note: Low-liquidity measures are applied when necessary
MB-V-0002 Vanadium pentoxide 98% V2O5 min, fob China, $/lb V2O5
Quality: Brown flake. V 98% min, Si, 0.25% max, Fe 0.30% max, S 0.03% max, P 0.05% max, As 0.02% max, Na2+K2O 1.50% max.
Quantity: Min 5 tonnes (+/- 5%)
Location: fob China (other delivery terms normalized)
Timing: Within 20 days
Unit: $/lb V2O5
Payment terms: L/C, T/T, other payment terms normalized
Publication: Weekly, Thursday, 2-3pm London time
Note: Low-liquidity measures are applied when necessary
The consultation period for this proposed change will end one month from the date of this pricing notice, on Tuesday October 20. Subject to further feedback, the change will take place on Thursday October 22.
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 Amy Lv by email at: pricing@fastmarkets.com. Please add the subject heading ‘FAO: Amy Lv, re: fallback procedures for Chinese vanadium fob prices.
To see all Fastmarkets’ pricing methodology and specification documents, please go to www.fastmarkets.com/about-us/methodology
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