Courtesy of ANZ, who got their call on the iron ore bounce this week just right:
Physical iron ore prices rose 1.2% to USD115/t. Iron ore swaps firmed across the curve, in line with physical prices. The most active Jul13 traded USD2.75 higher to USD114.92/t (hit a high of USD115.75/t intra-trade). Oct13 SHFE rebar futures rallied at the open yesterday morning, hitting a high of RMB3,508 before eventually ending the afternoon session down to RMB3,478 – but still 1.6% higher than Friday’s close. Thermal coal futures appear to have stabilised above the USD80/t level, but the mood in this market remains subdued. FOB Australian coking coal markets are still declining, albeit at a slower pace and are sitting at USD136.63/t. Reports suggest seaborne suppliers are facing increasing competition from Chinese domestic producers who are able to allow domestic buyers to delay payments amid tighter cash flows. Markets are looking for direction from monthly term contracts instead of the traditional quarterly contracts – with markets moving to monthly pricing amid the soft market conditions. Markets expect July monthly term contracts to be settled this week.
ANZ Commodity Daily 845 180613.pdf by Shaun Salas
