Wednesday, Oct 4, 2017 MARKET NEWS Coal News The API2 market pushed higher again following a firm day yesterday with Cal 18 closing at $79.85/t (85 cents higher than yesterday). This is a stark contrast to last week s trading, where Cal 18 API2 dropped from $82.00/t to $77.25/t over a two day period. The rebound has been helped by firmer power prices and the Newcastle market remaining firm. The Q417 and Calendar 18 Newcastle contracts closed at $96.25/t and $86.00/t respectively ($1.05 and $0.55 respectively). The spreads on the API2 remained well bid with Q417 v Q118 API2 paid up to 5.25, which is line with power remaining firm. On the option front, the implied volatility remains firm with 80 calls trading at 31.00%. Furthermore, Call skew is now flat to negative with Cal 18 API2 80/87 CS trading at -0.10% (80 calls 0.10% implied volatility below 87 calls). API 2/API 4 API 4 Bid $ Offer $ Mid $ Chg Bid $ Offer $ Mid $ Chg 1.55 2.05 1.80 0.80 89.85 90.35 90.10 0.50-1.00-0.50-0.75-0.20 90.75 91.25 91.00 1.30-2.05-1.55-1.80-0.15 90.30 90.80 90.55 1.35-0.50 0.00-0.25 0.15 90.30 90.80 90.55 1.05-2.65-2.15-2.40-0.35 87.20 87.70 87.45 1.30-3.55-3.05-3.30-0.80 82.90 83.40 83.15 1.60-2.40-1.90-2.15-0.85 79.75 80.25 80.00 1.50-2.20-1.70-1.95-1.00 77.95 78.45 78.20 1.60-2.70-2.20-2.45-0.75 81.95 82.45 82.20 1.50-3.80-3.30-3.55-0.70 76.95 77.45 77.20 1.50-3.55-3.05-3.30-0.70 72.80 73.30 73.05 1.50 Pg. 1
Iron Ore News Market Comment The market came to a standstill at the absence of Chinese trade participants. There was some uptick in the Tangshan billet prices which rose by RMB30 to RMB3,540, probably fueled by the good official PMIs that China posted in September. During the month, the official PMI rose to a five and a half year high, since 2012 to 52.4 rating, lifting market outlook on the manufacturing prospect in China. Port Inventory According to Umetal's survey of 42 ports in China, the total port inventory stood at 133.87 million tonnes on Friday, 29 Sep 2017, up 1.66 million tonnes as compared to last Friday, while daily cargoes evacuation decreased by 72,000 tonnes to 2.71 million tonnes. Technical Reports Oil Intraday Support and Resistance - Brent is now trading between the 10 and 20 period EMA s. technical support is at USD 56.28 and resistance at USD 59.49. price action is the lead indicator here so market longs should be cautious if we close below USD 56.87 on the daily chart and tighten risk. However we also see a hidden divergence on the stochastic and the short period RSI which would suggest another upward move is due soon. Iron Ore Volumes: Previous Day Swaps & Futures Product Volume (000's mt) Open Interest 62% 371 62,880 58% 0 0 Lump Premium 0 2540 Options (Swaps & Futures) Product Volume (000's mt) Open Interest 62% 3,190 86,114 Pg. 2
Oil News Commodities broker OTC Europe has agreed to purchase rival Oil Brokerage in the latest consolidation in a sector squeezed by rising competition and smaller margins. OTC Europe, a subsidiary of OTC Global Holdings, said it concluded its purchase of Oil Brokerage, a 29-year-old, London-based firm with some 70 staff, on Tuesday in an effort to expand its global footprint. "They're very big in areas we simply just weren't in yet, very big in areas that (are) growing geographically such as London and Singapore," OTC Global's President and co-ceo Joseph Kelly said of Oil Brokerage in an interview with Reuters. Kelly declined to disclose the value of the deal. OTC Global Holdings, established a decade ago in the United States, is the world's largest independent institutional commodities broker. The acquisition advances OTC's goal of becoming a one-stop shop for clients who want to take part in evolving and increasingly global commodities markets, Kelly said. He pointed specifically to rising U.S. exports of liquefied petroleum gas (LPG) and diesel to Europe, U.S. fuel oil exports globally and the physical European light end and fuel oil markets as areas for expansion. "The idea at the end of the day is that we will be this one place where you can do anything you need in commodities... whether it's moving a physical cargo, hedging, trading futures," Kelly said. Prior to this, OTC's London operations included crude oil products and derivatives, refined products and derivatives including middle distillates, gasoline cracks, biofuels and physical and financial LPG and natural gas liquids. OTC also has offices in Chicago, Geneva, Houston, New Jersey, Louisville, New York and Singapore. Oil Brokerage was founded in 1988 as a broker of physical gasoline in Europe, and later expanded to include physical and paper biofuels, naphtha and fuel oil. OTC now has a global portfolio of 20 companies, a network that could make the group more competitive in a market that has seen increasing consolidation amid the crude oil price rout and the popularity of electronic trading. Oil Brokerage itself closed its physical distillates desk in 2014, as did rival Marex Spectron. Rival brokerage Tullet Prebon acquired London-based oil PVM Oil Associates in a $160 million deal in 2014, and cut its own staff shortly afterwards. Last year, it finalised a 1.11 billion pound ($1.47 billion) deal to buy bigger rival ICAP Plc's IAP.L global hybrid voice broking and information business. Pg. 3
Physical Summary Platts HSFO Trade Summary: 6 trades 1) Platts HSFO 380CST: FOB Straits: 20kt: Oct 26-30: Mercuria sells to BP at MOPS plus $1.55/mt (4:28:43.766) 2) Platts HSFO 380CST: FOB Straits: 20kt: Oct 21-25: Hin Leong buys from Mercuria at $321.50/mt INCO (4:28:59.394) 3) Platts HSFO 380CST: FOB Straits: 20kt: Oct 19-23: Hin Leong buys from Mercuria at $322.00/mt INCO (4:29:17.750) 4) Platts HSFO 380CST: FOB Straits: 20kt: Oct 19-23: BP buys from Mercuria at MOPS plus $1.60/mt (4:29:34.567) 5) Platts HSFO 380CST: FOB Straits: 20kt: Oct 19-23: BP buys from Mercuria at MOPS plus $1.60/mt (4:29:52.565) Pg. 4
6) Platts HSFO 380CST: FOB Straits: 20kt: Oct 24-28: Hin Leong buys from Mercuria at MOPS plus $1.55/mt (4:29:54.221) Platts Gasoil Trade Summary: THREE trades reported 1) Gasoil 10ppm: FOB Straits: Oct 30-Nov 3: 165kb: PetroChina sells to BP at MOPS plus $1.90/b (Deemed pricing Oct 30-Nov 3) (4:28:13) 2) Gasoil 500ppm: FOB Straits: Oct 23-27: 150kb: Winson buys from CAO at MOPS plus 15 cents/b (Deemed pricing Oct 23-27) INCO (4:29:08) 3) Gasoil 500ppm: FOB Straits: Oct 19-23: 150kb: Hin Leong buys from CAO at MOPS plus 20 cents/b (Deemed pricing Oct 17-24) INCO (4:29:57) Pg. 5
PLATTS ASIA MOGAS CARGO MOC: DEAL SUMMARY: FIVE TRADES 1. 92 RON: FOB Straits: Oct 19-23: Unipec sells to Total at $65.00/b for 50kb (4:25:42) 2. 92 RON: FOB Straits: Oct 19-23: Unipec sells to Total at $65.00/b for 50kb (4:27:24) 3. 92 RON: FOB Straits: Oct 30 - Nov 3: PTT buys from BP at $64.75/b for 50kb (4:29:09) 4. 92 RON: FOB Straits: Oct 19-23: Unipec sells to Total at $65.20/b for 50kb (4:29:51) 5. 92 RON: FOB Straits: Oct 25-29: Vitol buys from PTT at $65.00/b for 50kb (4:29:52) Naphtha deals summary: Two Trades 1) Naphtha: CFR Japan: 25kt: H2 Nov: Idemitsu sells to Gunvor 507.50 (4:29:08) 2) Naphtha: CFR Japan: 25kt: H1 Dec: Idemitsu buys from Shell 504.50 (4:29:11) MGO Date LA/Long Beach New York Rotterdam Houston Rio De Janeiro Fujairah Hongkong Singapore 17.08.2017 538.00 502.00 461.50 486.00 625.50 555.00 489.50 473.50 18.08.2017 535.00 499.50 455.50 484.50 631.50 555.50 482.00 470.00 21.08.2017 534.50 495.50 461.50 492.50 619.50 555.50 480.50 474.00 22.08.2017 534.00 496.00 465.00 487.50 620.50 554.50 481.50 475.50 23.08.2017 533.00 494.00 462.50 487.50 637.50 554.00 479.00 471.50 24.08.2017 534.00 494.50 464.00 489.00 621.50 552.50 479.00 471.50 25.08.2017 538.00 496.00 464.50 487.50 631.50 555.50 481.50 474.00 28.08.2017 544.50 495.00 467.00 486.00 645.50 557.00 485.50 480.00 29.08.2017 550.00 499.00 463.50 503.00 640.50 554.50 488.00 483.00 30.08.2017 554.50 502.50 463.50 500.00 640.50 553.50 488.00 483.00 31.08.2017 558.50 503.00 465.50 513.00 640.50 552.50 486.00 485.00 04.09.2017 575.00 520.50 476.50 530.50 665.50 554.00 485.50 488.50 05.09.2017 586.50 535.00 478.00 574.00 695.50 557.00 495.00 498.50 06.09.2017 588.00 538.50 479.50 564.50 694.50 556.00 501.50 497.50 07.09.2017 588.50 539.50 483.50 577.00 698.50 559.50 506.00 503.00 Pg. 6
08.09.2017 593.00 543.00 491.50 578.00 698.50 562.00 513.00 508.50 11.09.2017 596.50 548.00 496.00 595.50 704.50 567.00 519.50 510.00 12.09.2017 596.50 549.50 494.50 579.00 719.50 565.00 519.50 510.50 13.09.2017 596.00 549.00 491.50 573.00 704.50 566.00 517.00 508.50 14.09.2018 596.00 549.00 491.50 573.00 704.50 566.00 517.00 508.50 15.09.2019 596.00 549.50 495.00 565.50 691.50 572.00 521.50 510.50 18.09.2020 598.50 552.50 501.00 575.00 701.50 573.00 523.50 513.50 19.09.2021 598.50 553.00 498.50 569.00 704.50 573.00 526.00 514.00 20.09.2022 598.50 552.50 500.00 567.00 711.50 573.00 527.00 513.50 21.09.2023 594.00 551.00 499.00 565.50 703.00 577.50 525.00 520.00 22.09.2024 593.50 552.50 505.50 575.50 701.50 579.50 525.00 520.00 25.09.2025 596.50 557.00 506.00 575.00 707.50 576.00 526.50 520.00 26.09.2026 609.00 562.50 509.50 571.00 705.00 578.50 528.00 518.50 27.09.2027 609.00 562.50 509.50 571.00 705.00 578.50 528.00 518.50 28.09.2028 624.00 565.00 510.50 567.00 707.50 575.50 536.50 521.00 29.09.2029 626.00 565.50 511.50 560.00 707.00 580.00 539.50 523.00 02.10.2017 625.50 564.00 513.00 557.00 713.00 587.50 540.50 526.50 03.10.2017 621.00 561.50 508.00 552.00 712.00 577.50 538.00 525.00 04.10.2017 610.00 558.00 504.50 548.50 705.00 576.50 532.50 519.00 380 Date LA/Long Beach New York Rotterdam Houston Rio De Janeiro Fujairah Hongkong Singapore 17.08.2017 323.00 313.50 296.00 290.50 316.50 311.50 320.50 309.00 18.08.2017 321.50 314.00 294.00 290.50 310.50 309.50 318.00 308.00 21.08.2017 322.50 311.50 295.00 291.00 322.50 310.50 317.00 308.50 22.08.2017 323.50 312.50 298.00 293.50 322.50 312.00 322.00 312.50 23.08.2017 323.50 313.50 298.50 290.50 317.50 313.00 324.50 313.50 Pg. 7
24.08.2017 324.00 315.50 299.50 293.00 317.50 311.50 323.50 313.50 25.08.2017 324.50 317.00 299.50 297.50 319.50 314.50 323.00 314.50 28.08.2017 327.50 314.50 300.50 297.50 321.50 313.00 324.50 316.00 29.08.2017 317.00 315.00 299.00 308.00 321.50 311.50 326.00 315.00 30.08.2017 318.50 315.50 299.00 305.00 326.00 311.50 326.00 315.00 31.08.2017 326.00 316.00 299.00 309.50 326.50 312.00 324.50 315.50 04.09.2017 334.00 320.00 304.50 313.50 328.50 313.50 324.00 317.50 05.09.2017 334.00 324.00 307.50 322.00 328.50 317.00 328.00 322.50 06.09.2017 335.50 325.50 307.00 321.50 330.50 316.00 328.00 321.50 07.09.2017 366.50 327.00 310.50 324.00 348.50 320.00 330.50 324.50 08.09.2017 339.50 329.00 313.50 323.00 348.50 326.50 335.50 334.00 11.09.2017 342.00 331.50 314.50 324.50 354.50 324.50 340.00 336.50 12.09.2017 344.00 331.00 311.50 317.50 348.50 326.00 340.00 336.00 13.09.2017 344.00 333.00 311.00 319.00 346.50 325.50 338.00 333.00 14.09.2018 349.00 335.00 315.00 320.50 342.00 327.00 395.50 334.50 15.09.2019 353.00 338.00 320.00 322.00 359.50 330.50 341.50 336.00 18.09.2020 359.00 341.00 320.50 327.50 358.50 333.00 347.00 339.00 19.09.2021 359.00 339.00 319.50 322.50 361.00 332.50 347.50 340.50 20.09.2022 359.00 337.00 320.00 319.00 363.00 332.00 348.50 342.50 21.09.2023 355.00 337.00 319.50 317.50 362.50 334.50 347.00 342.00 22.09.2024 354.00 334.50 321.00 319.00 364.00 336.50 347.50 342.00 25.09.2025 353.50 336.00 322.00 320.50 364.00 335.00 347.50 342.50 26.09.2026 357.50 340.00 322.00 321.00 374.50 336.00 349.50 344.00 27.09.2027 359.50 340.00 321.50 321.50 370.50 336.00 351.00 345.00 28.09.2028 361.00 340.00 321.50 321.00 368.50 335.50 352.00 346.00 29.09.2029 358.50 341.00 323.00 318.00 370.00 335.50 352.00 346.00 02.10.2017 356.00 340.50 324.00 318.50 370.00 335.00 355.00 346.50 03.10.2017 347.50 332.00 319.50 315.00 365.50 337.00 352.50 345.00 Pg. 8
04.10.2017 346.00 332.50 317.50 313.50 361.00 337.00 349.50 341.00 180 Date LA/Long Beach New York Rotterdam Houston Rio De Janeiro Fujairah Hongkong Singapore 17.08.2017 375.50 394.50 329.00 376.00 348.00 359.50 330.50 337.00 18.08.2017 374.50 393.50 326.00 374.50 342.00 357.00 326.00 336.50 21.08.2017 375.00 393.50 326.50 375.50 354.00 358.00 325.00 333.00 22.08.2017 376.00 395.00 329.50 382.00 354.00 363.50 330.00 339.00 23.08.2017 375.00 395.00 335.00 376.50 349.00 365.50 332.00 339.50 24.08.2017 375.00 396.00 330.50 377.50 349.00 362.50 331.50 339.50 25.08.2017 374.50 358.50 331.00 382.50 351.00 360.50 330.00 339.50 28.08.2017 378.00 342.00 332.00 384.50 353.00 361.00 331.50 341.00 29.08.2017 368.00 337.50 330.50 388.00 353.00 360.00 332.50 340.50 30.08.2017 367.00 338.00 335.00 387.00 358.00 355.00 332.50 339.00 31.08.2017 379.50 339.00 329.00 392.50 358.00 360.00 331.50 341.00 04.09.2017 386.00 340.50 336.00 396.50 360.00 359.50 341.50 342.00 05.09.2017 387.00 343.00 341.00 397.50 360.00 361.50 347.50 347.50 06.09.2017 387.50 345.50 344.50 403.50 362.00 360.00 340.00 344.50 07.09.2017 388.00 349.00 350.00 384.00 380.00 365.50 340.50 352.00 08.09.2017 390.50 351.50 353.00 382.50 380.00 359.50 345.50 352.00 11.09.2017 392.50 355.00 354.00 384.50 386.00 356.00 348.00 356.00 12.09.2017 393.50 352.50 349.50 384.50 380.00 355.50 348.00 356.00 13.09.2017 393.50 353.50 348.50 382.00 378.00 372.00 343.50 355.00 14.09.2018 398.50 355.50 353.50 387.00 386.00 371.50 345.00 360.00 15.09.2019 402.50 358.50 358.50 391.50 391.00 371.00 347.00 363.00 18.09.2020 403.50 360.50 360.00 394.50 390.00 375.00 352.00 360.50 19.09.2021 404.00 360.00 359.00 388.00 392.50 378.50 353.00 368.50 Pg. 9
20.09.2022 404.00 355.50 354.50 384.00 394.50 375.00 353.50 370.00 21.09.2023 399.00 357.00 352.00 381.50 394.00 387.00 352.50 372.00 22.09.2024 397.50 354.00 356.00 383.00 395.50 377.50 353.50 366.50 25.09.2025 397.00 355.50 356.50 383.50 395.50 391.50 361.50 366.50 26.09.2026 397.00 358.00 356.50 384.50 406.00 389.00 357.50 371.00 27.09.2027 399.00 358.50 356.00 384.00 402.00 383.00 358.00 372.00 28.09.2028 402.00 358.50 356.00 383.50 400.00 379.50 358.00 374.00 29.09.2029 401.00 359.50 357.50 383.00 401.50 374.50 357.50 374.00 02.10.2017 400.00 359.00 351.00 384.50 401.50 374.00 360.50 374.50 03.10.2017 399.50 355.00 349.00 383.00 397.00 373.50 358.50 371.50 04.10.2017 396.50 355.00 347.50 381.00 392.50 371.00 355.00 370.50 Pg. 10