Ferrous Market
– Asian traders believed iron ore exports from both Brazil and Australia will boost in Q4 according to seasonal pattern, in particular after Australia finished port overhaul in September.
– Both southern and northern ports showed interest to buy Yandi fines because of better cost and effective sinterability.
– Lump furnace input ratio rebounded from 10.7% in April to 12.2%, created new high from last November.
– Tangshan exit some steel rolling capacity, total decrease billet demand of 19,000 tonnes/day.
China Downstream
– China August local debts reached 120 million yuan, significantly up from July, created yearly high. Some areas are preparing for the projects in next year.
SGX Iron Ore 62% Futures& Options Open Interest(Sep 4th)
– Futures 76,431,500 tonnes(increase 323,500 tonnes)
– Options 106,865,500 tonnes(increase 815,000 tonnes)
Verdict
– Short-term neutral to bearish.