Ferrous Market
– China Ministry of Information and Industry Technology: prohibit new steel making capacity by decrease both steel capacity and production in the year 2021. It was the first time the department mentioning about production control over the decade.
– Mongolia major coal export ports closed during Feb 11 – 14th. Ports reopen in Feb 15th.
– Korea Feb 10 – 14th holiday, light physical steel trading, however mills maintain production. Vietnam has no holiday during February, however mid and small mills decrease utilization rate. Turkey and Iran both have some new capacity projects about to start.
– Ganggu Construction Steel: production 4.98 million tonnes, down 25,600 tonnes w-o-w. Mills inventory 7.45 million tonnes, up 936,500 tonnes w-o-w. Circulation inventory 11.02 million tonnes, up 1.87 million tonnes w-o-w.
Macro
– China Ministry on Commerce encouraged loan support on individual automobile purchasing by decreasing mortgage rate or extending payback period.
SGX Iron Ore 62% Futures& Options Open Interest(Feb 9th)
– Futures 76,754,200 tonnes(increase 801,500 tonnes)
– Options 48,098,500 tonnes(increase 710,000 tonnes)
Verdict
– Short-term neutral.
