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<br />Specifically, Contractor will submit a monthly report comparing (1) the average <br />Mean prices (FOB Shoreway Center) for which it sold Old Corrugated Cardboard <br />(OCC #11), Mixed Paper (MP #1), and Old Newspaper (ONP #8) during the <br />previous month with (2) those reported for sales of these commodities for <br />shipment to Asian markets from Los Angeles, as reported in the Official Boards <br />Report (the "Yellow Sheet"). <br /> <br />The process to be followed by Contractor in compiling its monthly price <br />comparison report is described below and illustrated on the accompanying Figure <br />1. <br /> <br />1. Monthly, obtain the Official Board Markets "Yellow Sheet" Export Los <br />Angeles Index during the second week of each month. Record the <br />average "Yellow Sheet" export price (A YSEP) Los Angeles Index less 30/0 <br />for the following fiber grades: OCC #11 (A YSEP-OCC), Mixed Paper #1 <br />(A YSEP-MP), ana ONP #8 (A YSEP-ONP). <br /> <br />2. Monthly, obtain the prevailing Ocean Freight Differential (OFD) from major <br />steam ship lines for ocean freight rates per 40 foot standard export <br />container of wastepaper shipped from Los Angeles/Long Beach Container <br />Yard versus Oakland Container Yard to primary Asian base ports. Convert <br />the OFD per container to OFD per ton by dividing it by 22.5 tons (45,000 <br />Ibs). <br /> <br />3. Monthly, obtain the average trucking charge (A TC) from transportation <br />companies (minimum of 3 quotes) for the total of the following services: <br />retrieve a 40 foot standard export shipping container from the Port of <br />Oakland Container Yard, deliver it to Shoreway where it will be loaded and <br />weighed, and then return it to the Port of Oakland Container Yard without <br />incurring demurrage charges. Convert the A TC per container to A TC per <br />ton by dividing it by 22.5 tons (45,000 Ibs). <br /> <br />4. Add OFD per ton and A TC per ton to obtain total adjustment. <br /> <br />5. Calculate the index value (IV) of OCC #11 (IVR-OCC), Mixed Paper #1 <br />(IV-MP) and ONP #8 (IV-ONP) by deducting the total adjustment (Step 4) <br />from the AYSEP-OCC, AYSEP-MP, and AYSEP-ONP. <br /> <br />6. Compare the free on board (FOB) average monthly market price mean <br />(MMP) at which SBR sold OCC #11 (MMP-OCC), Mixed Paper #1 (MMP- <br />MP), and ONP #8 (MMP-ONP) to the IV-OCC, IV-MP, and IV-ONP. <br /> <br />If the MMP is equal to or higher than the index value (IV) for each grade then no <br />further action is required. If the MMP is lower than the index value (IV) for any of <br />the grades, then SBR must pay the Authority the difference. . Additionally, the <br /> <br />Facility Agreement, Attachment 11 B <br />Commodity Price Assurance Mechanism <br />Page 2 of 3 <br />