Ferrous Market
– Steelbank Inventory: construction steel inventories 6.31 million tonnes, down 6.09% w-o-w. HRC 2.16 million tonnes, down 9.13%.
– Japan Iron & Steel Federation published data suggesting crude steel production 37.10 million tonnes in first half of Financial Year(Apr- Sep), down 26.8% y-o-y, also created the lowest since the year 1968.
– Tangshan started Level II pollution emergency, blast furnace, pellitising mills and related pollution related companies are required to follow the Tangshan environmental protection measurements sent earlier of the month. 26 steel mills are facing production curb or suspension.
– World Steel Association indicated September global crude steel production up 2.9% y-o-y at 156.4 million tonnes. China September crude steel up 10.9% y-o-y at 92.6 million tonnes.
Macro
– China is planning to reduce insurance tax, and return 100% union funds for small-cap companies incurred during the year 2020.
SGX Iron Ore 62% Futures& Options Open Interest(Oct 23rd)
– Futures 75,367,300 tonnes(decrease 321,700 tonnes)
– Options 96,574,300 tonnes(increase 305,000 tonnes)
Verdict
– Short-term bearish.