Fastmarkets expands range of frac sand price assessments

By William Clarke
Published: Friday, 01 February 2019

To better reflect the growing frac sand market in the United States, Fastmarkets is adding three new Northern White Sand price assessments to track the finer mesh sizes now being used in the fracking industry.

Wisconsin frac sand_Carol Mitchell
Wisconsin frac sand

Monthly ex-works Wisconsin price assessments will be launched for Northern White Sand: 30/50 mesh, API; 40/70 mesh, API; and 100 mesh, API. All prices will be US$ per short ton.

Frac sand use is seeing long-term growth in the US and Canada, with estimates for demand in 2018 ranging between 95 and 120 million short tons.

In September 2018, Fastmarkets launched its first frac sand price to cover this growing market and the 20/40 mesh, API, ex-works Wisconsin price assessment has been well received. 

The decision to price 20/40 mesh sand was based on the market inputs available at that point, even though this coarse-mesh sand only represented a minority of the market.

And feedback from the market suggests that a wider range of grades, and in particular finer mesh sizes, was needed to accurately reflect the market.

The type of sand being used is shifting. 

Frac sand users once set out to optimize the conductivity of frac sand formations, meaning the ability of oil to flow out of fracked wells.

This led frac sand buyers to favor large mesh sizes of the highest possible sphericity and crush strength, to create highly conductive formations.

This demand for large, regularly shaped proppants has even created a market in artificial ceramic proppants as large as 8/12 mesh.

But increasingly the trend is towards much higher intensity fracks, conducted at greater depths and down longer laterals. This is pushing demand for lower-priced, finer mesh frac sand.

Consultation with the market suggests buyers are now predominantly looking for much finer meshes. 40/70 and 100 mesh are currently the most sought after sand sizes. There is even demand for so-called ‘microproppant’ at sizes as fine as 200 mesh, although this remains a niche market.

In response to this shift, Fastmarkets is launching three new frac sand grades, taking in the whole range of commonly used mesh sizes.

In addition to the existing 20/40 mesh Northern White frac sand price, Fastmarkets will now price 30/50 mesh, 40/70 mesh, and 100 mesh. All these prices will be assessed on an ex-works Wisconsin basis.

The Wisconsin frac sand market was chosen because it combines a number of features that make it suitable as a pricing benchmark. There are a large number of buyers and sellers of this grade, so there is enough liquidity for regular assessments and the center of production is geographically concentrated.

To see data for Industrial Minerals' Northern white frac sand, 20/40 mesh, API, EXW Wisconsin, $/short ton price please click here.

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