TSI to launch coking coal index

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Commodity Online
The Steel Index ( TSI ) will launch a coking coal price index later this year to complement its world-renowned steel, iron ore and scrap indices. The new index is being launched in direct response to requests from industry participants around the world keen to see TSI's rigorous methodology applied to compile reliable coking coal prices, TSI informed in a press release.

TSI's data-driven methodology, in which reference prices are based on actual transaction prices collected from buyers and sellers through a secure on-line system, is greatly favoured by companies over telephone-polling approaches, TSI said.

Coking coal (metallurgical coal) is an essential ingredient in iron and steel production. Approximately 70% of steel worldwide derives from iron generated in blast furnaces that consume coking coal and iron ore. Coking coal now comprises around 25% of the globally-traded coal market and is the fastest growing and most volatile segment in the coal industry. On average, approximately 230 million tonnes are traded worldwide each year.


\"The addition of a coking coal index completes TSI's coverage of the steel supply chain,\" says Steven Randall, Managing Director of TSI. \"Coking coal prices can be more volatile than iron ore, scrap and steel prices, so the need for a reliable index that the market trusts is paramount. The steel industry is at a pivotal point in its evolution and TSI is pleased to play its role in supporting the developments needed.\"

TSI's iron ore and steel index prices are already used by miners, traders and steel mills worldwide as the basis for their index-linked pricing arrangements. Its iron ore index provides the settlement prices for over 95% of all iron ore swap contracts cleared worldwide, having been selected by the Singapore Exchange (SGX), LCH.Clearnet (London) and the CME Group (based in Chicago)



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Commodities

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