Market Verdict on Iron Ore：
• Neutral.
Macro:
• The Chinese central bank and the foreign exchange bureau said that they should maintain the healthy development of the stock market, bond market and property market. They should keep the exchange rate basically stable at a reasonable and balanced level. The CBRC stressed that the financial risk is generally convergent, the financial system is generally stable, and the capital market has long-term investment value.
• With the growing concern about inflation and the possible economic recession next year, American consumer confidence fell back in October after two consecutive months of growth, but households are still keen to buy bulky items such as motor vehicles and electrical appliances.
Iron Ore Key Indicators:
• Platts62 $89.50, -3.50, MTD $94.81. PBF float premium massively corrected from $2.35 to $1.05 last Friday, because of the weakened Chinese steel margin lowered demand on high premium. Mills and traders were sensitive about the float premium. However Chinese pig iron production was stablised on a 2.4 million tons during the current three weeks, a potential high in H2 2022. BHP narrowed MACF discount in November from 2.5% to 0%, narrowed JMBF discount from 6.5% to 4.5%. Thus, Chinese steel mills indicated that it would take more times to get acquainted with the increased cost from BHP sources.
SGX Iron Ore 62% Futures& Options Open Interest (Oct 25th)
• Futures 100,532,500 tons(Increase 39,800 tons)
• Options 88,330,400 tons(Increase 144,000 tons)
Steel Key Indicators:
• China 85 EAFs average operation rate at 57.95%, up 5.23% on the month, down 10.82% on the year.
Coal Indicators:
• FOB Australia coking coal maintained unchanged $299, concerning the supply tension after BOM reported a heavy rainfall of 100mm in Gladstone Port. The indicative tradeable value of Goonyella and Peak Downs was ranged from $296 – 307. A 75,000mt HCCA Branded offered at $350, for early January laycan.
