PRICING NOTICE: Proposal to launch two Chinese domestic vanadium prices

Fastmarkets proposes to launch two weekly Chinese domestic prices for vanadium products after some initial research and consultation with market participants.

The new price assessments will include one for vanadium nitrogen and one for vanadium pentoxide (V2O5) with both being proposed to be updated every Thursday.

Fastmarkets currently has two prices assessments for Chinese ferro-vanadium and V2O5 respectively and both are on a fob basis. The introduction of two more assessments for China’s domestic vanadium prices will further expand Fastmarkets’ current coverage of the vanadium 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 persisted so far this year, especially with regional differences in industrial recovery after the Covid-19 pandemic. 

As a result, Fastmarkets has captured few direct deals for vanadium products in the export market in the past year except for the volumes booked in long-term contracts between suppliers and buyers. 

In the absence of spot Chinese export liquidity, the market is in need of price assessments for the domestic Chinese market to directly track the trend in the country and gauge the opportunities for international business, including both imports and exports.

In addition to a domestic Chinese V2O5 price assessment, Fastmarkets is also planning to monitor the spot market for vanadium nitrogen - as opposed to ferro-vanadium - because it is a crucial indicator for the vanadium alloys market due to it having better liquidity.

Vanadium nitrogen has gained in popularity over ferro-vanadium among Chinese steel mills in the past few years, given that vanadium nitrogen is more cost-effective, market participants told Fastmarkets. 

Considering these factors, Fastmarkets believes it is necessary to launch domestic prices for vanadium products for market participants to better track and observe the market movements in China more rapidly.

The proposed specifications for the new price assessments are listed as below:

Assessment: vanadium nitrogen, basis 77%V, 16% N, ex-works China

Quality: Lump. V 77-81%, N 14-18%, C 6% max, P 0.06% max, S 0.10% max
Quantity: Min 20 tonnes (+/- 5%)
Location: ex-works China
Unit: CNY/tonne
Payment terms: Cash, other terms normalized
Publication: Weekly, Thursday, between 2pm and 3pm London time

Assessment: Vanadium pentoxide 98% V2O5 min, ex-works China
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 20 tonnes (+/- 5%)
Location: ex-works China 
Unit: CNY/tonne 
Payment terms: Cash, other terms normalized
Publication: Weekly, Thursday, between 2pm and 3pm London time

The consultation period for these proposed prices assessments will end one month from the date of this pricing notice on Thursday October 15. Subject to further feedback, the new price assessments will be launched on October 22.

To provide feedback on this price or if you would like to provide price information by becoming a data submitter to these prices, please contact Amy Lv by email at: pricing@fastmarkets.com. Please add the subject heading 'FAO: Amy Lv, re: new Chinese vanadium pricing.

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

Amy Lv

amy.lv@fastmarkets.com

Published

Amy Lv

September 17, 2020

08:50 GMT

Shanghai