Verdict:
• Short-run Neutral to Bearish.
Macro:
• US PPI up 1.3% in October, lower than estimated 1.9%, last 2.2%.
• China NDRC pricing department started co-working with DCE to research on the monitoring irregular movement of iron ore. Iron ore margin in exchange level raised from 13% to 15% in DCE effective after the settlement in November 20th.
Iron Ore Key Indicators:
• Platts62 $132.00, +1.80, MTD $127.98. Iron ore retreated after hearing the surveillance news from China NDRC and DCE. In fact, iron ore was over-speculated given a marginal decreasing demand in November. The market expected more shipments should go through Q4 in order to complete the big miners annual delivery target.
SGX Iron Ore 62% Futures& Options Open Interest (Nov 15th)
• Futures 132,641,500 tons(Increase 691,300 tons)
• Options 108,325,600 tons(Increase 2,528,300 tons)
Steel Key Indicators:
• Tangshan average pig iron cost at 2877 yuan/ton, while average billet cost at 3719 yuan/ton. Average loss on steel mills at 59 yuan/ton, down 77 yuan/ton on the week.
Coal Indicators:
• Coal miners and traders were waiting for the increasing bids on the seaborne after India holiday. There was a $290 bid for HCCA branded coal on the trading window yesterday, received no reply even rise to $295 afterwards.