Market Verdict on Iron Ore：
• Neutral to bearish.
Macro：
• U.S. non-agriculture claims increased by 223,000 in December, created the smallest increase since December 2020, higher than predicted 200,000.
• U.S. Atlantic Federal president Raphael Bostic indicated that the Federal would insist on interest hike to fight high inflation, till interest rate reach 5-5.25%. The high interest rate expected to maintain from 2023 to 2024.
Iron Ore Key Indicators:
• Platts62 $119.80, +2.60, MTD $117.91. PBF float premium were assessed at $1.2-1.8 based on February index; the February demand grew significantly. The float premium was strong compared to fixed price. The winter iron ore stock for Chinese mills entered a end with Chinese New Year looming, with most of stocks were purchased in portside, with flexible size and time. Steel mills suffered negative production margin because the uptick of raw materials and low steel sales. The market expected a correction on iron ore with lower marginal demand.
• China NDRC started to investigate the iron ore price fast increase recently.
SGX Iron Ore 62% Futures& Options Open Interest (Jan 6th)
• Futures 93,829,900 tons(Increase 2,189,600 tons)
• Options 69,295,800 tons(Increase 1,681,700 tons)
Steel Key Indicators：
• Chinese blast furnace rebar production margin realised average loss 52 yuan/ton, lower than last month loss at 37 yuan/ton. HRC average loss 109 yuan/ton, last month realised a gain at 28 yuan/ton.
Coal Indicators：
• 230 Chinese independent cokeries plants utilisation rate at 74.9%, up 1% from last week. Some northern steel mills in China proposed to decrease physical coke price by 100- 110 yuan/ton.