Ferrous Market
– Tangshan closed 7 blast furnaces(450m³) and set target to quit the low rank on air pollution level among 168 major inspected cities. China political conference started from today and market expect Hebei air pollution level would come down following historical rule. Tangsong indicated pig iron decrease by 11,500 tonnes/day. Current pig iron production is 2.45 million tonnes/day.
– MySteel Australia and Brazil iron ore total delivery at 24.07 million tonnes, up 1.49 million tonnes w-o-w. Australia iron ore delivery 18 million tonnes, up 1.06 million tonnes w-o-w. Australia delivery to China 14.57 million tonnes, up 21,000 tonnes w-o-w. Brazil iron ore delivery 6.07 million tones, up 433,000 tonnes w-o-w. Global iron ore delivery 32.13 million tonnes, up 3.1 million tonnes w-o-w.
– MySteel estimate year 2020 iron ore global production reached 2.22 billion tonnes. Year 2021 expected up 130 million tonnes to 2.35 billion tonnes.
– Australia port maintenance expected impact 900,000 tonnes of iron ores.
– Ganggu Construction Steel Inventory: production 5.08 million tonnes, up 60,200 tonnes w-o-w. Mills inventory 10.21 million tonnes, up 435,400 tonnes w-o-w. Circulation inventory 16.95 million tonnes, up 1.29 million tonnes w-o-w.
Macro
– China Banking and Insurance Commission said China’s interest rate is going up and potentially raise the loan rate as well.
SGX Iron Ore 62% Futures& Options Open Interest(Mar 2nd)
– Futures 65,339,600 tonnes(Increase 1,112,800 tonnes)
– Options 48,807,900 tonnes(Increase 470,000 tonnes)
Verdict
– Short-term neutral.
