Market Verdict on Iron Ore：
• Neutral to bullish.

 

Macro:
• U.S. ISM PMI in October at 50.2, refreshed new low since May 2020. U.S. markit manufacturing PMI 50.4, refreshed new low since June 2020.
• ECB president Christine Lagarde said that the main task of Europe at present is to stabilize prices, and all feasible means must be used to achieve this goal. Even if the possibility of economic recession in the euro area increases, the European Central Bank must continue to raise interest rates to fight inflation.
• Libya planed to nearly double its oil production to 2 million barrels a day before or by 2027, according to the Libyan National Oil Company.

 

Iron Ore Key Indicators:
• Platts62 $80.15, +0.65, MTD $80.15. Iron ore corrected massively last week, because of the sharp drop on steel margin and expected lower pig iron demand in the month ahead. NMHG was sold at $81.2, BRBF was sold at $82.2. The correction has already attracted bottom fishing traders. Thus, fixed-cargoes liquidity remain healthy.
• 5 out of 25 blast furnace of Tangshan started maintenance, or a decrease of 21,600 pig iron production. However some mills actively cut production concerning the low margin and weak downstream demand.
• Brazil miner CSN Q3 produced 9.625 million tons of iron ore, up 16% compared with Q2. Total sales in Q3 9.095 million tons, up 20% than Q2, export 7.973 million tons, up 19% than Q2.

SGX Iron Ore 62% Futures& Options Open Interest (Nov 1st)
• Futures 90,496,400 tons(Increase 3,376,700 tons)
• Options 80,989,300 tons(Increase 1,726,000 tons)

 

Steel Key Indicators:
• China October steel PMI down 12% on the month.

 

Coal Indicators:
• FOB Australia coking coal surprisingly up 4.5$ to $311.5 last Friday, although during the huge correction in ferrous complex globally. The market participants indicated that the PLV above $300 was supported by the lack of supplies. China buying interests for U.S. low volatility coking coal ranged from $270- 330. U.S. suppliers wouldn’t consider the opportunities at lower range given the high freight cost.