Ferrous Market
– Vale stopped Minas Gerais mining company Viga for 3 months, total impact 999,000 tonnes of pellitising iron ores. It is the second time of closure after Vale acquired this company from last August. However no direct impact on mid-stream concentrates.
– Mysteel(Sep 21- 27th) Australia and Brazil iron ore total delivery at 27.07 million tonnes, up 3.05 million tonnes. Australia iron ore delivery 18.89 million tonnes, up 1.3 million tonnes w-o-w. Australia delivery to China 15.96 million tonnes, up 1.57 million tonnes w-o-w. Brazil iron ore delivery 8.19 million tonnes, up 1.75 million tonnes w-o-w. Global iron ore delivery 33.91 million tonnes, up 4.195 million tonnes w-o-w.
– Brazil PDM Pier III maintenance during Sep 28- Oct 4th, total impact iron ore delivery arround 272,000 tonnes.
– China published a draft regarding winter air pollution curb on industry production, adding mid-west China area compared to last year. However changed pollution benchmark on the curb.
Macro
– World Bank estimate China 2020 economic growth rate at 2%, higher than previous estimation at 1% in June. Ex-China east Asian countries growth rate at -3.5%.
– China September industrial PMI 51.5, estimation 51.3, last 51.0.
SGX Iron Ore 62% Futures& Options Open Interest(Sep 29th)
– Futures 91,412,800 tonnes(increase 773,700 tonnes)
– Options 117,835,500 tonnes(increase 625,000 tonnes)
Verdict
– Short-term neutral.