Daily Brief Australia: Iron Ore, Alkane Resources and more

• The lack of specific stimulus from China’s 3rd plenary meeting and minor rate cuts led to a 2.5% decline in iron ore prices, highlighting market disappointment.
• Despite a 13.7% MoM increase in iron ore imports, market concerns arise from stockpile accumulation rather than domestic consumption, suggesting potential future import slowdown.
• SGX Iron Ore options showed a bearish trend with a weekly volume put/call ratio of 2.1 and notable put option increases for September and October expiries, indicating market pessimism.

Since our last update note on 20 May, Alkane has announced 1) the results of its scoping study on the Boda-Kaiser project, 2) FY24 production of 57,217oz Au at an all-in sustaining cost (AISC) guidance of A$2,150–2,350/oz, 3) an updated five-year mining plan at Tomingley and 4) regional exploration results from the Northern Molong Porphyry Project (NMPP). This note updates our valuation of the company for each of these developments, of which the most important are the results of the Boda-Kaiser scoping study.