Ferrexpo daily pellet output slides 3% m/m in July

Ukraine’s largest iron ore pellet exporter Ferrexpo (FXPO
LN, FXPOLN) produced 912 kt of pellets in July, which amounts to 29.4 kt per
day, a 3.0% m/m decrease, Interfax-Ukraine reported on Aug. 16.

During 7M18, Ferrexpo’s pellet output amounted to 6.0
mmt, a 2.0% yoy increase.

Dmytro Khoroshun: The 2% yoy
increase in the year-to-date dynamic (vs. a 1.2% decrease for 1H18) might ease
in August because in July 2017, Ferrexpo’s output was very weak at only 751 kt
(23.6 kt per day).

We expect Ferrexpo to produce 10.5-10.8 mmt of
pellets in 2018, resulting in 29-30 kt per day and a 1-3% yoy gain. We retain
our neutral view on FXPOLN Eurobonds.