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ICIS pricing produces around 250 different reports on an intraday, daily, weekly or monthly basis. The team also generates real-time news on global markets for ICIS news. We are committed to providing the most up-to-date, comprehensive and accurate market assessments and information possible. ICIS pricing staff are fully trained and equipped to be the market experts our clients can rely on for the critical decisions that need to be made in their businesses.
We recognise the emerging importance of markets in China, the Middle East, Russia and Latin America and the fact that no region operates in isolation. Our global teams communicate with each other on a daily basis as they track and assess our covered markets.
We are proud of what we do, and we are conscious of the huge responsibility we carry in the global chemical markets. We recognise the trust the market places in our information and aim to reciprocate through working to the highest standards.
ICIS continuously develops, reviews and revises its methodologies in consultation with industry participants. Product specifications and trading terms and conditions used aim to reflect typical working practices prevalent in the industry.
ICIS publishes market prices based on information continuously gathered from market participants about: spot transactions, spot bid and offer levels, contract price negotiations, prices of related commodities, and relevant freight costs.
ICIS includes in its price generation process only information gathered up to the published market close time for each commodity and assessed period.
ICIS does not make retrospective adjustments or changes to price quotations based on information subsequently received.
ICIS regards all arm’s-length transactions which meet its specification criteria as carrying equal weight.
ICIS uses proprietary models where necessary to normalize data to the typical specifications for cargo size and date ranges given for each commodity.
Some ICIS assessments are the product of calculation alone, for example in markets where insufficient market activity takes place to permit price assessment, or where a market habitually itself sets prices according to a formula. Such calculated assessments are noted as such in their detailed methodology specifications.
ICIS endeavours to cross-check all the transaction information it gathers.
ICIS will not use information for assessment purposes where such checks call into doubt the accuracy of the original information, or where a transaction appears to have occurred under circumstances that render it non-repeatable or otherwise markedly unusual.
ICIS publishes a number of types of market quotation:
Spot range assessments
Published daily and weekly, these delineate the typically tradable range for a full working day or week.
The range is normally established using verified typical transactions and standardized atypical transactions.
In the event that no relevant transactions have occurred in the assessed period, ICIS will establish a range using bids and offers for typical spec material; and using established market relationships resulting from manufacturing economics, product linkages, freight and forward markets.
Weekly range assessments are marked in some ICIS reports with a “+” to distinguish them from spot close assessments (see below).
Domestic prices are for regular long-term business between producers and consumers on a gross basis, and do not take account of any discounts or rebates which may be applied between individual suppliers and customers.
Instrument function: Provides overview of market activity over course of one day in the case of daily reports, or one week in the case of weekly reports. Width of range offers insight into current levels of market volatility. Variable range width means assessment trades off accuracy for inclusivity, and transparency is reduced vis-a-vis spot close assessment. Suitable for inclusion in averaging mechanisms and market analysis tools
Spot close assessments
Published daily and weekly, these reflect the transactable market value of the assessed product at the close of business for the assessed period (daily or weekly). Assessments are nevertheless shown as a low-high range, indicating the “space” in which a transaction is deemed to have been possible at the specified time. This low-high is typically tighter than that shown in a Spot Range assessment. The assessment is established taking into account:
· typical, repeatable transactions at arm’s length between non-affiliated market participants;
· standardized “atypical” transactions, where it is possible to derive a typical equivalent market value for a transaction which does not conform to standard specifications;
· bids and offers for typical spec material;
· movements in related markets. In the absence of reliable, confirmable market information for a specific commodity, ICIS reserves the right to compute changes in specific assessments based on established relationships derived from manufacturing economics, product linkages, freight, and forward markets.
Weekly Spot Close assessments are marked in some ICIS reports with a “*” to distinguish them from Spot Range assessments (see above).
Instrument function: Reflects most recent tradable market value with high transparency and high accuracy. Suitable for inclusion in averaging mechanisms and market analysis tools.
In some markets, ICIS publishes volume-weighted averages– known as “indexes” or “indices” – of verified typical transactions over specified periods, either daily or weekly.
Inputs to an index are checked editorially for conformity to specification and statistical outliers are eliminated. See individual methodologies for details.
Instrument function: An index is a mathematically derived indicator of typical traded value over a given period. Because it is an average, it should be noted that an index does not provide a currently transactable price indication – it is inevitably historical in nature; and both accuracy and volatility may vary with quantity of inputs. Suitable for long-term market analysis.
Contract reference prices
These are publicly announced, often single number, reference contract prices, agreed in multilateral negotiations and used as a base price for contractual sales of material by producers, typically between major producers and large end-users. ICIS publishes Contract Reference prices once confirmation is obtained of at least two agreements between recognised contract partners of significant size. Note that the date of publication can vary for each contract period depending on the speed of industry negotiations.
Instrument function: Contract reference prices are used in some markets as the basis for monthly or quarterly contracts and form the basis for further negotiations between producers and buyers on volume-related discounts or premiums.
Contract price assessments
Published weekly, these reflect the achievable “base price” for contractual sales of material by producers, either to onward “distributors” or direct to end-users. Prices, typically valid either for one month or for three, are arrived at by negotiation between producers and buyers, and are updated by ICIS once confirmation is obtained of agreement between major producers and typical buyers of the size indicated in individual specifications. Note that most contract prices are agreed as a base from which discounts or premiums are given to individual buyers, and that the size of these discounts typically varies based on the volume purchased over the contract period by the buyer.
In the event that market participants fail or decline to confirm outright contract price levels to ICIS, ICIS reserves the right to make its assessments of achievable contract prices based on established market relationships derived from manufacturing economics, product linkages, freight, and forward markets.
Instrument function: Provides view of baseline for currently prevailing contract mechanisms, where these are statically determined – that is, bilaterally negotiated contracts not based on automated averaging of spot market prices.
Published weekly for some markets, these reflect contract prices net of known discounts to typical-sized product distributors. See individual methodology statements for details.
Instrument function: Provides additional insight into typical prices paid by buyers in statically determined (ie bilaterally negotiated contracts not based on averaged spot market prices).
Published in ICIS Margin Reports, margin prices reflect computed differentials between different products related through the processing chain.
Instrument function: Provides insight into supply chain economics and industry profitability. Theoretically determines scope of pricing further along processing chain. Note that market bevaviour sometimes violates apparent margin economics. Suitable for in-depth market and industry analysis.
List or posted prices
Published weekly for some markets, these are released by manufacturers as suggested selling prices. In many cases, these prices are reduced after negotiations with buyers.
The change in prices from the previous period is indicated in blue as an increase (+), in red as a decrease (-) or no change (n/c) or not assessed (n/a). Changes for prices at the low end of each range are shown at the left and changes for prices at the high end of each range are shown at the right. Changes in weekly spot prices represent the changes from the previous week and changes in monthly or quarterly contract prices represent the change from the previous month or quarter.
Some reports cover a range of products. Trade in product of inferior quality (off-spec) is taken into consideration when it affects the market for material that meets standard specifications. Reference to off-spec/distressed cargo is at the discretion of the editor.
Periods referred to in contract price quotations are either months (noted by standard abbreviations) or quarters of the calendar year.
Q1 January February March
Q2 April May June
Q3 July August September
Q4 October November December
Contract prices for certain feedstocks are shown where appropriate. In all cases where feedstock prices are shown, they have been taken from the current ICIS pricing report for the product.
ICIS pricing reports are written on the day of publication. The only exceptions are when a public holiday impacts the market. In some circumstances reports will be compiled one or a maximum two days early. When this occurs, it is clearly marked on the report. ICIS pricing provides daily and weekly pricing reports. Deadlines (unless otherwise specified in the methodology) are 1700 hours local time in London, Singapore, Shanghai and Houston. Market close prices refer to this deadline, unless specified otherwise.
Contract price assessments are updated in reports as soon as possible after confirmation is obtained of contract settlement. Because the amount of time required to reach contract agreement varies from month to month, it is not possible to guarantee publication of monthly contract prices at the same point in each month.
Note that information received after the relevant close cannot be used for assessment purposes, nor can a correction be issued based on subsequently received information.
The date of publication is not altered in the event of public holidays. All weekly reports are published at least 50 times per year. Certain reports are not published during a two-week period in late December/early January. Daily reports are published five times per week, but may not appear on certain days due to public holidays. Please refer to the ICIS pricing publishing schedule for more detailed information.
ICIS pricing normally covers products on a regional basis to ensure the main drivers impacting the market in any given area are adequately covered. Reports are currently issued covering Europe, the Middle East, Asia or Asia-Pacific, China, India, West Asia, the United States or North America, Latin America, and the Former Soviet Union.
Within these broad areas the most common quotations comprise:
Morocco, Algeria, Tunisia, Libya, Egypt, Sudan
Eritrea, Djibouti, Somalia, Kenya, Tanzania
Namibia, Mozambique, South Africa
Mauritania, Senegal, The Gambia, Guinea-Bissau, Guinea, Sierra Leone, Liberia, Côte d’Ivoire, Ghana, Togo, Benin, Nigeria.
Prices are quoted with reference to the terms and location of delivery. The period of delivery is also quoted for contract prices. Assessment windows vary from product to product for spot sales. See specific product entries in the Methodology for further details.
Incoterms devised by the International Chamber of Commerce are mainly used to indicate what costs are included in the price. Assessments do not include Value Added Tax (VAT). Terms regularly used in ICIS pricing reports can be found in the Glossary.
Prices are quoted in the currency and unit measure relevant to the particular market. Most chemicals are quoted in US dollars per metric tonne ($/MT), although euros per metric tonne (€/MT), US cents per pound (US CTS/LB) or US cents per gallon (US CTS/GAL) are frequently used. Historical data includes assessments previously measured in European currencies superseded by the euro.
Conversions (weights and measures)
Prices are converted to other currencies and unit measures for ease of reference. Conversions are derived from the quoted price assessments using standard rates of conversion and current exchange rates. Conversions involving weights and volumes are calculated within industry acceptable ranges, which vary from product to product according to specific gravity (e.g. USD/MT to CTS/GAL).
Foreign exchange rates
ICIS provides exchange rates for a variety of international currencies that are time aligned with publication of our pricing reports and consistent for analytical use when applied to historiacal pricing data. Because of our publishing schedule, certain rates used in some reports may be changed as data moves into a historical database. The ICIS methodology used is as follows:
Rates are not established by ICIS pricing but are published by arrangement with Xenon (www.xe.com). The exchange rates shown are those in effect at the time and date indicated, normally around 17:15 hours in London on the day of publication. They are not a mean or average of exchange rates in effect during the period since the report was last published, but reflect a mean of the bid/offer at the time taken for that particular day. Exchange rates published by ICIS pricing are intended only as a reference and rates offered by local banks or other financial institutions may vary.
ICIS pricing also offers a real-time currency conversion tool, with a click-through link from the pricing reports, to enable subscribers to make quick exchange calculations.
Non-market price adjustments
Non-market price adjustments are necessary on the rare occasions when after careful consideration it is determined that the level of a price assessment is deemed to have become unrealistic. Before any decision is taken to adjust a price level, a broad spectrum of market participants is polled for their views on both the necessity and potential impact of any planned change and its timing.
Once it is clear an adjustment is required, ICIS pricing posts a notice telling subscribers it intends to make the change, and asks for any feedback over a two week period. After two weeks, and if it is decided to proceed, a second notice is posted informing subscribers that the adjustment will be made two weeks later. All price adjustments take place with a minimum four weeks public notice to subscribers.
Once the adjustment has taken place it is prominently mentioned in the price report it applies to. ICIS also adds a note to the online Price History to explain the apparent step-change in prices. It is important to note that price change deltas remain unaffected by any adjustment and the price trend remains accurate.
Contract Price Change Deltas
In some markets, contract settlements - especially quarterly ones - can evolve further after the initial assessment. This may mean that the actual market movement to the next settlement may not be fully aligned with the mathematical difference between the reported prices in one period and the next. In such cases, ICIS may make an Editorial decision to publish the new period's price range without including a delta value in the price table. The reasons for doing so and the indications of the actual market movement would be discussed in the text of the report. The delta box in these cases would show as “not assessed” (n/a).
Price history - key changes to methodology for contract prices
ICIS price history has been modified such that contract price assessments now relate to the period to which they apply irrespective of their settlement date. This change has been applied retrospectively to all quotes, including discontinued quotes.
As a result:
For a monthly contract (or quarterly) quote selected as frequency ‘C’ and downloaded as csv or displayed as a table in the original quoted currency the report date is given as the first of the month (or quarter). For a contract selected as frequency ‘C’ and displayed as a graph, a ‘stepped’ chart of the value (or average of the low and high where applicable) is displayed with the steps occurring on the first of the month (or quarter).
For a contract quote selected as frequency ‘C’ in any currency other than the original a single monthly (or quarterly) value (low, high and average) is displayed. This value is derived using an average of the foreign exchange rates taken at 16:00 UTC (GMT) on each of the publication dates within the month (or quarter). For the current period, the average foreign exchange rates for all the publication dates within the period to date are used.
For a contract quote selected as frequency ‘W’, the report date is given as the ICIS pricing weekly report publication date – the contract value (low, high and average) applicable to that month (or quarter) is displayed (which, depending on settlement date, may differ from the contract value reported at the time in that week’s ICIS pricing report). For a contract quote selected as frequency ‘W’ and displayed as a graph, a ‘stepped’ chart is displayed with the steps occurring on the first publication date within the month (or quarter).
For a contract quote selected as frequency ‘W’ in any currency other than the original, the contract value is converted for each week using the foreign exchange rate taken at 16:00 UTC (GMT) on the publication date.
Where a contract for the current period has not yet settled, no contract value shows in a weekly price history series – price history terminates at the end of the period to which the last settled contract price applies.
Where a contract settles for a future period, it does not display in price history until publication of the first ICIS pricing report within that period.
Where an initial contract value is reported for a period, and subsequently revised, the latter (or latest) value is taken as the contract value for the whole period.
15 July 2013