Market Verdict on Iron Ore：
• Neutral.
Macro:
• The U.S. Federal Reserve raised interest rates by 50 basis points in the last FOMC in 2022 as expected, and the benchmark interest rate rose to a new 15 year high of 4.25% – 4.5%, and reiterated that it was “possible” and appropriate to continue to raise interest rates in 2023. In addition, the matrix indicated that the peak interest rate reached 5.1% next year, beyond expectation, and predicted that the interest rate would remain high before 2024.
• U.K. CPI up 10.7% in November year-on-year, est. 10.9%, fell from the 41-year-high in October.
Iron Ore Key Indicators:
• Platts62 $109.75, -0.55, MTD $109.06. The physical trades fell into seaborne mid-grade again during early half of this week. PBF was traded in fixed price a t $110.15. JMBF was traded at a $5.6 discount based on January average. China traders indicated expecting no more curbs in winter, to catch up building and manufacturing impacted by pandemic during most time of the year. India fines were active in Asia, with 22-23% discount at IODEX January Index, which potentially generate pressure to FMG or other low grade market. Chinese concentrates supply expected to increase as the loosening of pandemic control and normalisation of transportation.
SGX Iron Ore 62% Futures& Options Open Interest (Dec14th)
• Futures 102,646,000 tons(Increase 841,200 tons)
• Options 83,205,300 tons(Increase 322,500 tons)
Steel Key Indicators:
• Chinese winter stock for steels in downstream and physical traders were in general smaller compared to last year. The tradeable range for rebar was around 3600-3700 yuan/ton.
Coal Indicators:
• Australia FOB marketmaintained strong at $249-250, supported by the wet weather impact on eastern Australia PMV supply. There was HCCA Unbranded Prime offer at $255 from last week, however failed to entice bids.
