Market Verdict on Iron Ore：
• Neutral.
Macro：
• IMF published the World Economic Outlook, estimated global economy growth by 2.8% in 2023, 0.1% lower than previous expectation. The estimated growth rate up 3% by 2024, down 0.1% than last prediction.
• A report from the New York Federal Reserve stated that the Federal Reserve will reduce the cash and bonds in the coming years, and may face negative net income in the coming few years. The bank stated that the Federal Reserve’s current holdings of $8.7 trillion in assets may decline to around $6 trillion by mid-2025 and remain stable for about a year.
Iron Ore Key Indicators:
• Platts62 $122.00, +2.35, MTD $120.87. Current light trade was due to limited supply from West Australia because of cyclone, which would impact at least 4 days till the end of the week. In last week, market cooled down following the fair trading and speculation control from Chinese regulators. Thus, physical traders initially cleared some stocks. The fixed trade potentially change into index based float cargoes in next few months given a fast drop on index. In addition, the weak import margin would resist the resilience from demand side.
SGX Iron Ore 62% Futures& Options Open Interest (Apr 11th)
• Futures 92,456,600 tons(Increase 984,500 tons)
• Options 100,965,500 tons(Increase 1,185,500 tons)
Steel Key Indicators：
• China construction steel trading volume was in 80- 85% during same period of last 2-3 years. Market failed to see an over-expected performance in H1 2023.
Coal Indicators：
• Australia FOB market saw ample supply on spot cargo, which potentially provide downward pressure on the market
• The Chinese traders revealed that the local mills are negotiating with miners on a 100-200 yuan/ton discount on coal product.