Market Verdict on Iron Ore：
• Neutral.
Macro
• U.S. April CPI up 8.3% y-o-y, narrowed from March at 8.5%. Core CPI up 6.2% y-o-y, higher than expected 6%.
Iron Ore Key Indicators:
• Platts62 $133.50, +5.40, MTD $136.78. Seaborne iron ores such as PBF saw several interests based on sales with discount. However weak steel margins also limited the size of deals. Physical traders indicated that market was interested in FMG SSF as well as some low grade Indian fines. Buyers would be interested on discounted PBF however not accepting moderate premium.
Steel Key Indicators
• China NDRC recently issued a notice on the verification of the assessment on crude steel output reduction in 2022, requiring all cities to verify and feed back the steel capacity base number of this assessment.
• Tangshan average billet cost 4721 yuan/ton, down 105 yuan/ton. Steel margin – 81 yuan/ton, down 45 yuan/ton.
Coal Indicators
• China National Development and Reform Commission: signing medium and long-term coal contracts is important to stabilize the coal supply and demand and promote the consistent development of upstream and downstream. The government encourages and supports long-term sales contract equal to or longer than 1 year.
