Market Verdict on Iron Ore：
• Neutral.
Macro:
• Chinese NBS: For the first nine months of the year, Chinese industrial enterprises value-added above designated scale 6.24 trillion yuan, down 2.3% y-o-y.
• U.S. Q3 GDP up 2.6% on the year, higher than expected 2.4%, created the first positive growth quarter after two consecutive negative growth quarter.
Iron Ore Key Indicators:
• Platts62 $82.50, -5.30, MTD $93.74.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.
• Kumba lowers iron ore export after Transnet strike, from 38 -40 million tons to 36-37 million tons.
• MySteel 45 ports iron ore inventories at 129.44 million tons, up 314,600 tons w-o-w. Daily evacuation 3.079 million tons, up 92,100 tons w-o-w. Australia iron ore 57.07 million tons, down 603,000 tons w-o-w. Brazil iron ore 47.098 million tons, up 800,400 tons w-o-w. 93 ships at ports, up 30.
SGX Iron Ore 62% Futures& Options Open Interest (Oct 27th)
• Futures 102,748,900 tons(Increase 2,506,900 tons)
• Options 95,619,400 tons(Increase 2,900,000 tons)
Steel Key Indicators:
• Tangshan mills average pig iron cost 2939 yuan/ton, average billet cost 3815 yuan/ton, down 3 yuan/ton. Average production loss at 235 yuan/ton.
Coal Indicators:
• FOB Australia coking coal index was flat. PLV from Peak Downs was traded in 30,000mt at $288.25 for November laycan. U.S. blue creek No 7 offer to China at $330.
