Market Verdict on Iron Ore：
• Neutral to bullish.
Macro
• BOE increased interest rate by 25 basis points to 1% as expected, which was the fourth increase from last December. BOE base interest rate reached the highest over the last 13 years.
• China Transportation Department announced that the high way tolls and previous closed service centers had recovered operation.
Iron Ore Key Indicators:
• Platts62 $142.90, +0.55, MTD $142.90. Seaborne premium was heard higher after China Labour Day holidays, with restocking demand from mills. 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.
• MySteel 45 ports iron ore inventories at 143.25 million tons, down 1.93 million tons w-o-w. Daily evacuation 3.16 million tons, up 178,800 tons w-o-w. Australia iron ore 67.47 million tons, down 1.27 million tons w-o-w. Brazil iron ore 46.74 million tons, down 1.079 million tons w-o-w. 89 ships at ports, down 20.
• Vale’s volumes jumped by 37.33% to 6.67 million tons from Brazilian ports accessed during the period from April 24 -30th. The previous four-week average shipments were at 5.01 million tons.
• BHP’s exports slumped by 30.22% week on week to 3.96 million tons from Port Hedland, impacted by continued COVID-19 and scheduled maintenance. The previous four- week average shipments were at 5.22 million tons over the previous.
SGX Iron Ore 62% Futures& Options Open Interest (May 5th)
• Futures 70,988,800 tons(Increase 208,200 tons)
• Options 69,744,500 tons(Increase 125,000 tons)
Steel Key Indicators
• MySteel estimated EAF average profit margin at 15 yuan/ton, up 17 yuan/ton.
• Arcelor Mittal estimated the global steel consumption potentially drop by 1% in 2022.
Coal Indicators
• China Shanxi coking coal road transportation recovered, market expect miners to decrease offers to control inventories levels in the following weeks.
