Fastmarkets Proposes Amendment to Iron Ore 62% Fe Port Stock Index

Understanding Fastmarkets' Iron Ore Index Name Amendment Proposal

Fastmarkets, a leading price reporting agency in the metals and mining industry, has proposed significant changes to its iron ore 62% Fe fines index. This amendment aims to better reflect current market realities and ensure the index accurately represents the quality characteristics of mid-grade iron ore fines commonly traded in China. The proposal marks an important development for market participants who rely on these benchmarks for contract pricing and market analysis.

What Is Fastmarkets Proposing to Change?

Fastmarkets is proposing to modify both the name and base specifications of its iron ore 62% Fe fines index. According to the official pricing notice released on July 29, 2025, these changes aim to align the index more closely with the evolving quality profile of iron ore being traded in the market.

Key Elements of the Proposed Change

The proposal includes several significant modifications to the index:

• Index Name Adjustment: Changing from "Iron ore 62% Fe fines" to "Iron ore 61% Fe fines"
• Fe Content Modification: Base specification shifting from 62% to 61% (with a range of 60-63%)
• Chemical Composition Updates: Revised specifications for silica, alumina, phosphorus, and sulfur
• Physical Properties Clarification: Updated moisture and granularity specifications

This amendment will affect two key price assessments:

• MB-IRO-0011: Iron ore fines FOT Qingdao (yuan/wet tonne)
• MB-IRO-0022: Iron ore fines FOT Qingdao, dollar conversion ($/wet tonne)

"Following an initial consultation with the market, and a review of the typical data sets that have been collected over recent months, Fastmarkets is proposing these changes to ensure both match the latest quality of mid-grade fines commonly traded in the market," stated Adele Pan in the official Fastmarkets pricing notice.

Why Is This Amendment Being Proposed?

Market Alignment Factors

The primary driver behind this amendment is the evolution of iron ore quality characteristics in the physical market. The current quality of mid-grade fines traded in China has gradually shifted from the original 62% Fe benchmark that was established years ago.

Fastmarkets' analysis of recent market data indicates that the typical iron content of what traders consider "mid-grade fines" has been consistently closer to 61% rather than 62%. This subtle but important shift necessitates an adjustment to ensure the index remains representative of actual traded material.

The index aims to track spot prices of iron ore fines in the 60-63% Fe range in the CFR China market, with base specifications designed to match the prevailing quality of mid-grade fines. As these quality characteristics have evolved, so must the index parameters to maintain market relevance.

Importance of Accurate Benchmarking

Accurate benchmarking is crucial for several reasons:

• Price Discovery Integrity: Ensuring the index accurately reflects actual traded material
• Market Transparency: Providing clear specifications that match current market realities
• Commercial Relevance: Maintaining the index as a useful tool for contract pricing and risk management

Without this adjustment, there's a risk of growing divergence between the index and the physical market it aims to represent, potentially undermining its utility as a reliable benchmark.

What Are the Specific Technical Changes?

Detailed Specification Modifications

The proposed technical changes are comprehensive and include adjustments to both chemical and physical properties:

These specifications have been carefully calibrated based on Fastmarkets' analysis of recent trading patterns and quality characteristics in the physical market. The addition of explicit base specifications for impurities like silica and alumina represents an enhancement to the methodology, providing greater clarity and precision.

Technical Assessment Details

Beyond the changes to quality specifications, the index will maintain its current assessment parameters:

• Geographical Scope: FOT Qingdao, normalized for any Chinese mainland sea port
• Timing Specifications: Deliveries within two weeks
• Minimum Quantity: 500 tonnes
• Origin Requirements: All origins accepted
• Publication Schedule: Daily at 6:30pm Singapore time
• Payment Terms: Payment at sight, with other terms normalized to base

These parameters ensure the index remains focused on the specific market segment it aims to represent, while the quality adjustments ensure it accurately reflects the material being traded.

How Will This Change Impact Market Participants?

Potential Market Effects

The proposed changes may have several implications for market participants:

• Contract Adjustments: Companies using these indices in term contracts may need to review and potentially amend their agreements. This is particularly important for contracts that explicitly reference the 62% Fe specification.

• Price Comparison: Historical analysis will need to account for the specification changes. While the historical data from January 2014 will be maintained, analysts should note the specification change when examining long-term iron ore price trends.

• Trading Strategies: Market participants may need to adjust their trading approaches, particularly if they've been using specific quality differentials based on the 62% Fe benchmark.

• Risk Management: Derivatives and hedging strategies based on these indices may require recalibration to account for the new specifications.

Disclaimer: Market participants should consult with their legal and commercial teams to assess the specific implications of these changes for their contracts and trading strategies.

Implementation Timeline

Fastmarkets has outlined a clear timeline for implementing these changes:

• Consultation Period: July 29 to August 27, 2025
• Planned Implementation: September 1, 2025 (subject to market feedback)
• Historical Data: Data history from January 2014 will be maintained

This timeline provides market participants with sufficient opportunity to review the proposed changes, provide feedback, and make any necessary adjustments to their commercial arrangements before implementation.

How Does Fastmarkets Ensure Methodology Integrity?

Consultation Process Details

Fastmarkets employs a structured consultation process to ensure its methodologies remain robust and market-relevant:

• Feedback Collection: Market participants can provide input during the consultation period by emailing pricing@fastmarkets.com with the subject heading "FAO: Adele Pan, re: Iron Ore 62% Fe port stock index"

• Confidentiality Options: Comments can be marked as confidential if desired. As stated in the pricing notice: "Please indicate if comments are confidential. Fastmarkets will consider all comments received and will make comments not marked as confidential available upon request."

• Transparency Commitment: Non-confidential comments will be made available upon request, ensuring an open and transparent process

Methodology Governance

The proposed amendment is part of Fastmarkets' ongoing methodology assessment process, which includes:

• Regular Reviews: Periodic evaluation of methodologies to ensure continued relevance
• Market Engagement: Active consultation with industry participants to gather feedback
• Documentation: Complete methodology documentation publicly available at Fastmarkets methodology page

This governance framework helps ensure that Fastmarkets' indices remain credible, representative, and useful to market participants.

What Is the Iron Ore Port Stock Index?

Index Fundamentals

The iron ore port stock index is a crucial benchmark for the iron ore market overview:

• Market Coverage: Tracks spot prices of 60-63% Fe iron ore fines in the CFR China market
• Geographical Scope: FOT Qingdao, normalized for any Chinese mainland sea port
• Timing Specifications: Deliveries within two weeks
• Minimum Quantity: 500 tonnes
• Origin Requirements: All origins accepted

This index is particularly important for participants in the Chinese iron ore market, as it provides transparency on pricing for material that has already arrived at Chinese ports and is available for immediate delivery.

Technical Assessment Details

The index features several technical specifications that define its scope and application:

• Publication Schedule: Daily at 6:30pm Singapore time
• Payment Terms: Payment at sight, with other terms normalized to base
• Product Package: Part of Fastmarkets steelmaking raw materials package
• Currency Units: Published in both yuan/wet tonne (MB-IRO-0011) and $/wet tonne conversion (MB-IRO-0022)

These details ensure that market participants have a clear understanding of what the index represents and how it can be applied to their commercial activities.

FAQ: Common Questions About The Index Amendment

How Will Historical Data Be Handled?

Historical data from January 2014 will be maintained, providing continuity for market analysis. However, users should note the specification change when analyzing long-term trends. The adjustment to 61% Fe base specifications represents an evolution rather than a complete redefinition of the index.

Can Market Participants Provide Input?

Yes, feedback can be submitted via email to pricing@fastmarkets.com. Comments should include the subject heading "FAO: Adele Pan, re: Iron Ore 62% Fe port stock index" to ensure proper routing. Market participants are encouraged to provide detailed feedback during the consultation period from July 29 to August 27, 2025.

What Happens After The Consultation Period?

Following the consultation period, Fastmarkets will review all feedback received and announce its final decision prior to implementation. Unless market feedback indicates otherwise, implementation will proceed on September 1, 2025, as planned.

How Does This Change Reflect Market Evolution?

The amendment recognizes the changing quality profile of mid-grade iron ore fines in the Chinese market. It ensures the index remains representative of actual traded material by adjusting the base Fe content from 62% to 61% and adding explicit specifications for impurities and physical characteristics.

This proposal to amend fastmarkets' iron ore 62% fe port stock index name maintains the index's relevance as a benchmark for market participants. With declining iron ore prices in some markets, accurate benchmarking becomes even more critical, reflecting Fastmarkets' commitment to providing useful price references. Furthermore, those seeking iron ore forecast insights will benefit from these adjustments as they better align with current market conditions.

Further Exploration:
Readers interested in learning more about iron ore pricing methodologies can explore related educational content on the Fastmarkets website, including their complete methodology documentation. Additionally, the changing specifications for Australian iron ore have contributed to this evolution in benchmarking, as detailed in recent industry reports. Those analyzing long-term iron ore demand insights will find these updates particularly relevant to their forecasting models.

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