The MCIS NWE Steam Coal Marker is a long established price indicator, first quoted in January 1991, and produced on a monthly basis until earlier this year when the frequency was changed to weekly postings. For historical comparison and indexation purposes, the monthly price is taken from the first price quoted each month. The monitored price is a spot price delivered CIF to Northwestern European ports, in US$/t for 6,000 kcal/kg (25.13 GJ/t) coal, with 1% or below sulphur content, on a Net as Received (NAR) basis. The marker is prepared through regular communication with key market participants. Input for the marker is collected up to 3pm Central European Time, on the last business day of each week for publication on that day. To maintain balance and consistency and to ensure that no one business sector is dominant in the survey, a wide variety of major buyers, sellers, traders and brokers are contacted each time the index is produced. Prices that are quoted on a FOB (Free on Board) basis are converted to CIF using freight rates supplied by the London ship-broking community servicing the relevant routes for delivery within the appropriate time frame. The origin prices are then weighted against the volume of coal imports into Northwestern Europe as reported by the European Commission. It should be noted that the method of weighting is currently under review.
The coals monitored are all steam coals for power station and general industrial use for delivery within 90 days. Spot prices are defined as one off purchases from single barge cargoes to large Capesize vessel cargoes. Northwestern Europe is defined as shipments, of the most economical vessel size, into ARA, France, Belgium, North Sea Germany, Ireland and the UK. The index captures the majority of traded coals, but excludes higher sulphur coals on the basis that these require much lower sulphur material to blend with them to ensure an acceptable power station fuel. All coals are converted to a standard value of 6,000kcal/kg NAR.
