Ferrous Market
– Steelbank Inventory: rebar inventories 7.37 million tonnes, down 0.33% w-o-w. HRC 2.13 million tonnes, up 0.29% w-o-w.
– China HRC FOB SS400 Tianjin price at $505- 510, created global low currently. Export HRC started to grow and import steels come to an end.
– Physical traders are interested in low aluminum concentrates and Brazil iron ores before winter comes.
Coal and Macro
– Russia Jan – Aug coal production at 259 milllion tonnes, down 8.08% y-o-y.
– China moved to further ease foreign access to equity market on Friday, officially combined QFII and RQFII and broadening the scope for foreign institutional investment, effect on Nov 1. Securities Regulatory Commission indicated from Jan – July, the foreign investment through two venues(QFII/RQFII) created the six year high.
– China Financial exchange also increased 3% on margin level on financial index futures, the first time to increase margin during holiday, indicating the policy to control over-speculation on equity derivatives.
SGX Iron Ore 62% Futures& Options Open Interest(Sep 25th)
– Futures 89,364,500 tonnes(increase 832,100 tonnes)
– Options 117,460,500 tonnes(increase 125,000 tonnes)
Verdict
– Short-term bearish.