| EU CRC/HDG prices continue struggling under import pressure | | Transaction prices for CRC and HDG in Europe remained below domestic mills’ expectations last week as traders were able to offer competitive prices both for new orders and prompt delivery materials at the docks, Platts learns from market sources. European mills are currently selling their March rolling, but some of them are already sending out indications for April production, hoping to achieve slightly higher prices compared with Q1 sales.
A source at a mill-tied service centre confirmed that for Q1 deliveries a number of deals were done below the offer levels, as demand remained weak and offers from traders were competitive. Nevertheless he stressed that for April deliveries the mills are expecting to realistically achieve increases of €5-10/mt on the current levels, to some €570-580/mt DDP base Germany for both CRC and HDG. He added that offers for Q2 deliveries are in the range of €580-620/mt ex-works for CRC and HDG from north European integrated mills.
The same view on Q2 was shared by other market sources, but a mill sales representative stressed that during the last two weeks deals significantly below the offer levels were concluded for February and March deliveries. Two sources noted the lowest sales concluded in Benelux and Spain for CRC at €545/mt ex-works base (Q1 deliveries), some €15/mt below the level sought by producers, due to the fierce competition in the market.
Traders confirmed that the euro/dollar exchange rate is currently making imports from Asia more competitive; despite the long lead-times (deliveries for new orders are expected in June/July). Currently CRC from Asia can be ordered at some €540-550/mt CFR Europe base, while thin-gauge HDG is pegged at some €620-630/mt CFR Europe effective.
“Clients are trying to bid at some €600/mt CFR effective for HDG thin gauges, but is still a level slightly too low compared with the current available offers,” a trader said, stressing that despite the competitive offers, taking a position for delivery in June/July represents a huge risk. | | | | | | Iran rebar price at 'record high', billet in short supply | | Iranian domestic rebar is trading at over IRR 21 million/metric ton ($857) on Tehran’s off-exchange market, a level deemed a historical record by market players in Tehran and Esfahan who spoke to Platts last week. This price is up 3% on the previous week.
Most traders believe the upward price trend will continue in the coming weeks. "Imported billet is trading for over IRR 19 million/mt at ports, so the rebar price could be increased even more," a trader in Esfahan said.
Prices on the Iran Mercantile Exchange (IME) have also jumped. In the latest trades on January 30, domestic produced rebar was sold at IRR 18.97 million/mt ($774), about 5% more than the initial offer. Domestic slab was also traded at 5% up on the producer’s initial offer at IRR 13.78 million/mt ($562) after competition between buyers.
Most importers have held off from selling imported product over the last week because the Iranian rial is depreciating. The formal exchange rate is $1/IRR 12,260; however, the semi-formal and unofficial rates are weakening every day, which is driving the price of steel higher.
The market is also worried about the possibility of increased economic sanctions on Iran, which could make importing even more difficult than it is currently and lead to a decline in domestic production. In spite of high billet and rebar prices, demand clearly outstrips supply; market participants are not optimistic about the future, the trader observed. | | | | | | Vale sees 2012 ore output dip despite record Q4 | | A record high in Vale's iron ore production in the last quarter of 2012 was not enough to prevent an output decline year on year. The company’s production report, released Friday, showed a drop of 0.8% in 2012 output compared to previous year, while Q4 registered the highest level ever for the period.
Annual iron ore production reached 320 million metric tons in 2012 against 322.6 million mt in 2011. In Q4, production reached 85.5 million mt, up 1.9% from the prior quarter. “It was the first time since 2003 that a Q4 performance exceeded Q3,” said the company.
The strong Q4 result was due to the start of operations at Vale's northern Brazil N5 South project in the Carajás system. The project is expected to account for 25% of Carajás run-of-mine (ROM) output this year.
Vale also attributed Q4 growth to dryer weather. However, weather conditions were blamed for the weaker full-year production. In early 2012, Vale declared force majeure in iron ore deliveries due to heavy rains.
Vale expects to strengthen its North and Southeastern System operations from Q2 2013, with two projects to be concluded – Carajás's additional 40 million mt and the Conceição Itabiritos project. These projects will contribute to “increased production and average Fe content, and cost reduction,” it said.
The current company average iron content is 65% Fe. Vale is retrofitting several older mines located in the Minas Gerais Iron Ore Quadrangle, Itabiritos included, to compensate for diminishing reserves by using the latest technology and changing processes.
According to Vale, the outlook for this year is for moderate global demand, requiring “discipline in capital allocation and focus to maximize efficiency and minimize costs.” | Vale's iron ore production | | | Thousand metric tons | | | | 2012 | 2011 | 2012/2011 | | Northern Carajás | 106,786 | 109,795 | -2.7% | | Southeastern Itabira | 37,682 | 40,007 | -5.8% | | Southeastern Mariana | 37,224 | 38,996 | -4.5% | | Southeastern Minas Centrais | 40,681 | 41,150 | -1.1% | | South Itabirito | 31,774 | 30,420 | 4.4% | | South Vargem Grande | 22,609 | 21,425 | 5.5% | | South Paraopeba | 25,917 | 24,408 | 6.2% | | Center-West Corumbá | 4,611 | 4,074 | 13.2% | | Center-West Urucum | 1,765 | 1,509 | 16.9% | | Subsidiary Samarco | 10,912 | 10,847 | 0.6% | | | | | | | Iron ore weekly wrap-up: Prices rise on post-holiday hopes | | Bullish sentiments for stronger steel performance after the Chinese New Year holiday buoyed buying interest and lifted spot prices for iron ore last week. Prices moved back above the $150 mark, as the HSBC manufacturing purchasing managers’ index for January came in at the highest level in two years, indicating an increased rate of expansion in Chinese industrial activity last month.
Platts 62% Fe IODEX assessment rose 4% or $6/dry metric ton week on week to $154/dmt CFR North China on Friday. The Steel Index’s reference price for the same grade ended the week at $153.20/dmt CFR Tianjin port, higher by $4.60/dmt or 3.1% than the previous Friday.
"We received more interest from the mills today as there are parties doing the last spurt of spot buying before the holiday period," a Shanghai-based trader said Friday. All sources reported that demand for spot iron ore was resilient as spot buyers were upbeat that China’s new government would roll out more pro-growth initiatives after the holiday, which would boost demand for steel.
"Most of the buyers are interested in procuring now to hold until after the holidays, after which they think spot prices are going to strengthen," a Guangzhou-based trader said. TSI reported congestion at the country’s major import hubs, exacerbating mills’ supply problems.
Australian mining giant Rio Tinto sold at $140.51/dmt CFR China a rare 58.9% Fe mixed fines cargo on the spot market Friday through an open tender to Singapore-based trader Swiss Singapore. This is a "one-off" cargo that Rio Tinto is offering on a spot basis, according to a company spokesman from the miner's Melbourne office. The cargo is made up of stockpiled material from the Brockman area, and is not part of a blend nor a new product. | | | | | | Coal weekly wrap-up: Aussie rain, Chinese buying lift prices | | Spot metallurgical coal prices in Asia rose again last week after heavy rains caused a rail line closure in Australia, and Chinese sentiment improved on the back of higher steel and iron ore prices.
Premium low-volatile hard coking coals gained $2.50/metric ton over the week, reaching $172.50/mt FOB Australia on Friday, while second-tier HCC was lifted by $1/mt to $156.50/mt.
With the Blackwater rail line in Queensland, Australia, expected to be out of service for at least another week, a large number of steel mills globally have vessels either waiting or half-filled at Gladstone port.
This has forced those mills with lower inventories or more exposed to Gladstone to supplement their procurement with spot coal out of other ports or countries, lifting demand beyond the usual Chinese spot buyers.
In addition, Chinese mills have undertaken a sudden restock of raw materials ahead of this month’s Chinese New Year holiday, further lifting seaborne spot demand. This appears to be partly driven by the expectation that prices will rise further after these holidays.
PCI coal continued on its months-long rally, and has now gained 43.6% since mid-September 2012. Supply in this segment remained tight due to cold weather-related logistical disruptions in Russia and China, and safety-related mine closures in China, sources said.
In the Atlantic basin, market conditions were tighter last week. Platts assessed prices for low-volatile hard coking coal higher on the week, rising from $146.50/mt to $149/mt FOB US East Coast. | | | | | | Scrap weekly wrap-up: Prices decline in Asia and Turkey | | Turkey’s scrap import market was slightly livelier in the week of January 28-February 1 as mills and suppliers from the US East Coast in particular negotiated over a reasonable price for February deep-sea shipments.
Thursday saw two deep-sea bookings made from North America. One was at $397/metric ton for premium HMS 1&2 (80:20) off the USEC; the second was from Canada at $393/mt CFR Marmara. The Canadian supplier had begun by offering its mixed cargo at $405/mt CFR Turkish ports, but failed to find support at that level.
In terms of spreads to finished products, margins remained close to breakeven for Turkish mills, who are showing signs of trying to tailor their output to match demand more stringently this year: several EAFs have already informed Platts of upcoming maintenance or stoppages in January. The January average margin between scrap imports and rebar exports in Turkey was $201.59/mt.
For January, Platts average daily scrap assessment was $403.50/mt CFR Turkish ports for premium 80:20, $15.11/mt higher than the previous monthly average. However, February opened at $391/mt CFR Turkey.
Asian scrap prices weakened last week. Hyundai Steel’s purchase price for H2 grade scrap was ¥31,500-32,000/mt ($341-346/mt) from ¥ 32,000/mt the previous week. The downturn in Korean domestic scrap prices continues this week: Hyundai will slash its domestic scrap buying prices by Won 10,000/mt ($9/mt) for all grades at its Pohang works effective February 6.
The scrap import market in Taiwan remained soft, trading sources said Friday. Limited deals for containerized HMS 1&2 80:20 from West Coast USA were concluded at $385/mt CFR down $5/mt every successive week for the past three weeks.
The approaching Lunar New Year holidays also dampened import buying interest in the region. Less business was taking place because mills rather wait till after the holidays to purchase scrap, a Vietnamese trader said. Another said that prices are stable at $400-405/mt CFR Vietnam for containerized 80:20 from South America.
A Vietnamese mill recently booked two bulk scrap cargoes. The first was for a 30,000-35,000 mt HMS 1&2 70:30 cargo for February shipment from Europe at a composite price of $415/mt CFR during the week ended January 25. At the end of that week, the mill also ordered a 40,000 mt US cargo of 70:30 of HMS/shredded at a composite price of $427/mt CFR.
One bulk cargo of US scrap for March shipment was booked at $424/mt CFR China during the same week. Limited bulk scrap offers for 80:20 are prevailing at $420-430/mt CFR East Asia, depending on port, traders said.
US domestic market sentiment continued to point toward a soft sideways pricing environment for February scrap settlements but many also anticipate markets varying region to region.
A mix of wintry weather conditions in pockets of the country in conjunction with transportation issues on the Mississippi River and differing January price settlements have market players painting a different picture region to region on how February scrap negotiations will settle this week.
The northeast, a pocket of price strength last month settling $10/long ton higher than most regions, could see prices come under pressure due to declining export activity and prices. US East Coast dockside prices declined $5/lt last week and there were multiple reports of deals being concluded with east coast mills and foundries of down $5/lt.
The Steel Index’s reference price for shredded scrap stood at $387/lt delivered US Midwest mill last week, down by $3 or 0.8% from the previous week. | | | | | | Shagang's higher Feb flat steel prices support spot market | | Eastern China’s Shagang released its February flat steel prices on Friday, raising hot rolled coil prices by Yuan 220/metric ton and plate by Yuan 180/mt. As a result, its Q235 5.5mm HRC price was listed at Yuan 4,300/mt ($691/mt) with 17% VAT, while Q235 20mm plate was at Yuan 4,180/mt with VAT.
The increase was in anticipation of a strong flat steel market throughout the first half of 2013, some of Shagang’s trading agents told Platts. Meanwhile, rising raw material prices were also a factor.
Over January-February, Shagang has increased HRC prices by a total of Yuan 370/mt and plate by a total of Yuan 380/mt. Traders in both Shanghai and Guangdong's Lecong steel market told Platts that Shagang’s large price increases had further improved market sentiment.
However, spot market prices did not advance further on Friday as business was quite slow. Most market participants were winding down for the Spring Festival holidays and some trading companies had already closed on Friday afternoon.
On February 1, Q235 5.5mm HRC prices were prevailing at Yuan 4,180-4,200/mt with VAT in Shanghai and Yuan 4,230-4,250/mt with VAT in Lecong, both unchanged from the previous day.
Meanwhile, according to a Shanghai-based industry analyst, HRC market inventories in Shanghai were almost unchanged over the week of 1 February. But these HRC inventories were still about 2% higher than in early January and were expected to continue climbing during the holidays. | | | | | | Indian HRC market wary ahead of Feb price announcements | | Even as Indian hot rolled coil producers were deliberating Friday whether, and by how much, to lift domestic prices this month, market sources remained mostly pessimistic about higher prices being achieved given the sluggish demand.
“This whole thing has become such a farce,” a Mumbai-based mill official said. “We announce increases that don’t go through and are rolled back through the month,” he said, adding that his mill was nevertheless announcing an increase of Rupees 800-1,000/metric ton ($15-19/mt) this month.
In December and January, producers had achieved price increases of only about Rupees 500/mt against announcements of rises of Rupees 750-1,500/mt. “There should be some consensus (among suppliers) that come-what-may we will not roll back the rises,” the official added.
Another Mumbai-based mill official suspected that in a slow market his company might shy from lifting base prices. “Everyone knows demand is not strong enough to support higher prices,” he said.
A Mumbai-based trader observed that higher international prices favored Indian export sales, meaning producers faced less pressure in the domestic market and could lift prices there. “There is no threat from imports now, but how long that will last remains to be seen,” another Mumbai-based trader remarked. Although coil import offers from various origins remained sparse or were unattractively priced, the rupee had strengthened against the dollar from to 53.3 by press-time Friday from 53.9 earlier in the week.
Transaction prices for IS 2062 grade A/B structural HRC, 3mm thick and above, had averaged Rupees 33,500-34,000/mt ($628-638/mt) ex-works through January. Sources expected mills to announce their February prices by Monday. | | | | | | Chinese mills expand flat steel capacity on better market | | An improving domestic market for flat steel has led Hebei Iron & Steel subsidiary Chengde Iron & Steel (Chenggang) to restart a 150 metric ton converter and 1,780mm wide hot strip mill by end of February, sources said Friday.
Chenggang idled both pieces of equipment in late 2010 on a weak market and falling profits, and over the past two years rebar had been more profitable than HRC, a mill official said, so production had been concentrated on rebar.
However, beginning H2 last year the flat steel market showed signs of picking up and expectations grew that the market will continue improving in 2013 in tandem with a recovery of the manufacturing sector. Thus, Chenggang has decided to re-launch HRC production, the official added.
Platts notes that Q235 5.5mm HRC prices in Shanghai and Guangdong Lecong steel market bounced by 28% and 31% respectively from early September to be now at Yuan 4,180-4,200/mt ($672-675/mt) with 17% VAT and Yuan 4,230-4,250/mt with VAT.
The hot strip mill is capable of producing 300,000 mt/month of hot rolled coil, but initially Chenggang expects to produce only around 100,000 mt/m. All output will be sold domestically.
Meanwhile, late last month eastern China’s Shagang finally commissioned its very first cold strip mill, delayed from early 2012. The firm is believed to have chosen to commission the mill now because of the flat steel market recovery.
The No.1 cold strip mill is 1,420mm wide and has a production capacity of 1.3 million mt/year. Shagang’s No.2 cold strip mill, identical to the first, is still under construction and will be commissioned later this year. | | | | | | Shagang lifts early February rebar but shorts futures | | Eastern China’s Shagang has increased its rebar price by Yuan 200/metric ton ($32/metric ton), effective February 1. Market participants said that surging raw material costs and the positive post-Chinese New Year market outlook were behind the large price hike. However, in the longer term the strength of the market was less certain.
Shagang’s prices for 16-25mm diameter HRB335 and same-sized HRB400 rebar were lifted to Yuan 4,050/mt ($650/mt) and Yuan 4,150/mt respectively, and 6.5mm Q235 wire rod was raised Yuan 150/mt to Yuan 4,000/mt, all with 17% VAT.
A Shanghai trader suggested that the mill raised early February prices by such a large margin in order to pass on increases in raw material costs to buyers. He expected that spot market prices could further trend upwards after the Chinese New Year. It was only a matter of how long price increases could be sustained and how large the increase would be, he believed.
Despite weak physical buying ahead of the holiday, futures prices remained firm, also lending support to spot steel prices. The widely-traded May rebar contract on the Shanghai Futures Exchange closed up 0.99% to Yuan 4,168/mt last Friday. The contract hit Yuan 4,170/mt during the day’s trading, the highest price for the most-active contract since May 15 2012.
However, another steelmaker noted that Shagang was short on the May rebar contract and this suggested a cautious attitude towards the longer-term strength of the market. | Shagang's 16-25mm HRB335 rebar price | ©SBB 2013 | | Yuan/metric ton | | | | Incl. 17% VAT | Excl. 17% VAT | | Shagang ex-works | 4,050 | 3,462 | | | | | | | North China rebar steady on limited transactions | | Northern China’s market dealers have further increased their rebar offers, after major Chinese construction steel suppliers, including Hebei Iron & Steel (Hegang), unanimously increased their rebar list prices for early February deliveries.
Hegang raised its early February list price for 18-25mm diameter HRB400 rebar by Yuan 50/metric ton ($8/mt) from end-January’s reference price to Yuan 3,800/mt ($610/mt) with 17% VAT. However, this marked a major increase of about Yuan 140/mt compared with the mill's contract price through January.
Market sources suggested that prevailing offers for Hegang-sourced 18-25mm diameter HRB400 rebar had increased to about Yuan 3,740-3,750/mt by February 1, but actually many dealers had ceased trading because of the coming Chinese Spring Festival. Transaction levels during the day were quite limited and the tradable price was rather stable at around Yuan 3,710-3,730/mt with VAT.
Although it is widely expected that the Chinese steel market should fare better after the holiday, a number of market sources were concerned that some people were overoptimistic. One Beijing trader suggested that demand might remain in dull immediately following the holiday for seasonal reasons. A boost in demand has historically come after March when the weather begins to warm, he noted. | China's 18-25mm HRB400 rebar price | ©SBB 2013 | | Yuan/metric ton | | | | Incl. 17% VAT | Excl. 17% VAT | | Hegang ex-works | 3,800 | 3,248 | | Beijing | 3,710-3,730 | 3,171-3,188 | | | | | | | Seamless pipe prices stable, E. China market quiet | | Seamless pipe prices in eastern China’s spot market remained range-bound last week as round billet feedstock prices again increased on Friday, Platts learned from market sources.
In Shanghai’s dealer market on February 1, traders were offering 219x6mm (GB/8163) seamless pipes sourced from pipe mills in eastern Shandong province in the range of Yuan 4,600-4,700/metric ton ($739-755/mt) with 17% VAT, unchanged from the previous week.
Transactions had become sparse in line with other markets ahead of the Spring Festival holiday (February 9-15), a Shanghai trader said. A rise seen in round billet feedstock prices and expectations of a stronger post-holiday steel market could support prices at the current level, she added.
Several steel mills in eastern Jiangsu hiked billet prices by Yuan 50-70/mt on February 1, taking 20# round billets for early-February delivery to around RMB 4,320-4,350/t ($694-699/t) with 17% VAT.
Contacts told Platts they will cease trading around February 6 for the holidays, while others have already closed down. As a result, transaction levels should be low no matter whether traders adjust prices or not, a second trader said.
The trader doubted prices would increase much after the holidays because of steel oversupply, which is especially serious for pipes. As Platts reported, newly commissioned capacity boosted China’s seamless pipe production by about 9% year-on-year in 2012 to 28.2 million mt/year, a new record high, according to the Chinese National Bureau of Statistics. | Seamless pipe prices in Shanghai | | | 219x6mm, Grade 8163 | | | | Incl. 17% VAT | Excl. 17% VAT | | Yuan/metric ton | 4,600-4,700 | 3,932-4,017 | | | | | | | Hysco-Sumitomo India pipe JV to start trials | | The pipe joint venture in India between Korea’s Hyundai Hysco and Sumitomo Group companies from Japan is slated to start trials this month, the Korean mill said on Friday. Named Automotive Steel Pipe India and located in Tamil Nadu’s Sriperumbudur, west from India's auto-hub of Chennai, the venture has a capacity in carbon steel ERW pipes of about 4,000 metric tons/month.
“Testing will begin this month but for now we cannot provide a definite date,” a Hysco spokesman said. The venture’s ERW pipes for automotive use will have an outer diameter range of 0.5-3 inches, he added.
Hysco owns 55% of the jv while the remainder is held by SPT&SC Investment, an entity owned 75% by Sumitomo Pipe & Tube (SPT) and 25% by trader Sumitomo Corp.
Supplying the hot rolled coil feeds will be steelmakers from Japan and Korea, most likely from Hyundai Steel, Platts is told. Hysco and Hyundai Steel are subsidiaries of Hyundai & Kia Automotive Group which has a vehicle assembly plant in Chennai.
Meanwhile, Hysco said it is also scheduled to start operating its new pipe mill in Ulsan near Busan in Korea this month. The new mill has a capacity of 50,000 mt/year and is capable of making pipe up to 3 inches OD, also for auto use.
Last week, Hysco announced that it aims to produce 879,000 mt of pipes this year, up 10% from its output of 801,000 mt last year. Its catalogue includes ordinary pipes, line pipes and others for industrial use. | | | | | | Asian stainless prices rise on higher nickel, mill offers | | Prices of East Asian-origin grade 304 2B 2mm stainless steel cold rolled coils were assessed at $2,670-2,700/metric ton CFR China on Friday, up from $2,650-2,700/mt a week earlier on stronger nickel prices and higher offer prices from Taiwanese mills late in the week.
Taiwanese CRC was offered $50/mt higher at around $2,750/mt CFR China, Hong Kong and Southeast Asia late last week, with mills citing higher raw material costs for their price increases. But as offers were put out only late last week, traders said they still need time to gauge customers’ response.
Some traders reckoned it would be hard for the market to accept $2,750/mt. “$2,750/mt is too high. We won’t accept. A price close to $2,700/mt but less than $2,700/mt is acceptable. Demand is still weak in the market,” said a Hong Kong-based importer.
But on the other hand, sellers are firm with their offer prices due to the recent rise in nickel prices. Moreover, there is typically a seasonal rise in stainless prices after Chinese New Year holidays. “At most we can give a $5-10/mt discount,” said a south Taiwan-based exporter who had offered at $2,750/mt CFR Southeast Asia late last week.
New offers from Korean suppliers are expected this week. Offers for Korean CRC were at $2,650-2,700/mt CFR China and Taiwan in late January. But materials at $2,650/mt are believed to be already sold out in the market. “We had inquired about buying at $2,650/mt but was told that their (Korean supplier) bookings at this price were full,” said a north Taiwan-based trader late last week.
Nickel prices surged by more than $1,000/mt over the past week to finish at $18,370/5/mt on 31 January. | | | | | | Nickel price rise shores up Chinese stainless values | | Chinese domestic prices of stainless steel coils in Guangdong’s Foshan spot market were under pressure late last week as sellers offload materials in exchange for cash ahead of the Chinese New Year holidays, sources said.
But the latest surge in nickel prices to above $18,000/mt, combined with tighter supply during winter, helped to shore up stainless prices, they said.
Consequently, prices of grade 304 coils ended up little changed. Those of grade 304 3mm hot rolled coils were heard at a slightly wider range of Yuan 17,000-17,300/mt ($1,993-2,028/mt) on February 1, while those of 2mm thick grade 304 CRC were heard at Yuan 18,000-18,300/mt, a slightly narrower range than a month ago.
Prices of 2mm thick grade 430/2B CRC were at Yuan 9,300-9,500/mt on February 1, down Yuan 100-200/mt over the past month. Prices of 1-2mm thick grade 201/2B CRC slipped Yuan 100/mt over the past month to Yuan 11,100-11,200/mt on February 1. All prices include 17% VAT.
Prices could have been lower if not for the rise in nickel prices, said market participants. Nickel prices rose by around $1,000/mt over the past week to finish at $18,370/5/mt on January 31. Nickel prices had fluctuated between $15,800/mt to $17,800/mt for nearly four months.
Heavy snow and fog in parts of China during the winter has also hindered transportation and logistics, hence checking supply to an extent, said market observers. Industry participants are expecting a seasonal rise in prices after Chinese New Year. “Those purchasing materials in the market after the holidays will most certainly be paying higher prices,” said an official with a south China mill. | Chinese stainless prices (Foshan market) | | | Yuan/mt | | | | 304 HRC 3mm | 304 CRC 2mm | | November 1 | 17,300-17,500 | 18,000-18,300 | | December 4 | 16,800-17,200 | 18,200-18,400 | | December 28 | 17,000-17,200 | 18,000-18,400 | | February 1 | 17,000-17,300 | 18,000-18,300 | | | 430 CRC 2mm | 201 CRC 1-2mm | | November 1 | 9,500-9,700 | 10,900-11,200 | | December 4 | 9,500-9,600 | 11,200-11,300 | | December 28 | 9,500-9,600 | 11,200-11,300 | | February 1 | 9,300-9,500 | 11,100-11,200 | | | | | | | Japan’s 2012 steel exports rise – just | | Exchange rate challenges, tougher competition from Korean rivals and consumer boycotts in China failed to dent Japan’s total steel exports last year. For this, the Japanese mills have Thailand to thank, according to Japan Iron & Steel Federation data disclosed Friday.
Japan exported 42.49 million mt during last year, up 3% from 2011 and just shy of the record 43.4 million mt Japan shipped abroad in 2010. But supporting last year’s grand total was a huge six-fold year-on-year increase in pig iron exports – to 402,600 mt – and a 73% jump in ferroalloys exports, to 230,400 mt.
On an ordinary carbon steel basis, the increase was more subdued – a mere 1.1% rise from 2011 to 27.68 million mt. In the total, the largest item was hot rolled coils at 10.24 million mt, up 17% year-on-year. It was here that Japanese HRC exports to Japanese-invested cold rolling mills in Thailand became apparent; Japan’s HRC exports to Thailand last year soared 28% from 2011 to nearly 2 million mt.
Conversely, the new HRC capacity in Korea continued to sap Japanese exports, with HRC tonnage shipped there last year dipping 4.5% to 2.08 million mt. As recently as 2008, Japan shipped about 3.5 million mt of HRC to Korea. Though total exports to Korea were lower 7.2% from 2011 to 8.21 million mt, Korea remains Japan’s largest steel buyer.
Exports to China meanwhile plunged 12% last year to 6.08 million mt (including 4.07 million mt in carbon steel, down nearly 18%) reflecting the fallout from Beijing’s noisy territorial dispute with Tokyo. Fortunately, the year-on-year decline of 815,000 mt was all-but-offset by a 784,000 mt-surge (17%) in Japan’s exports to Thailand. These reached 5.4 million mt, an all-time high. | Japan's 2012 steel exports (selected) | | | Source: JISF | | | | '000 mt | y-o-y change | | Semis | 5,513 | 7.9% | | Sheet piles | 185 | 78.3% | | Heavy plates | 3,608 | -1.7% | | HRC | 10,239 | 17.3% | | CRC | 3,186 | -14.5% | | Galv | 4,618 | -6.4% | | Seamless pipes | 645 | -6.2% | | Stainless | 1,176 | -5.6% | | Grand total | 42,495 | 3.1% | | | | | | | China’s manufacturing sector extends recovery | | Two Chinese manufacturing purchasing managers indices (PMIs), one official and one published by HSBC, moved in different directions in January. However, both continued to show a recovery in the sector, Platts notes.
The HSBC PMI rose to 52.3 in January from 51.5 in December and from a flash estimate for January of 51.9. But the official manufacturing PMI fell to 50.4 from 50.6 in December. A figure over 50 still indicates growth and so the fall only marks a slowdown in the recovery.
The official PMI surveys mostly large state-owned enterprises, while the HSBC survey includes more small- and medium-sized companies. Historically, the HSBC PMI has underperformed the official one, in part because smaller companies, which have less privileged access to loans, have been hit harder by any economic slowdown.
The HSBC PMI has now shown expansions for three months in a row. "We see increasing signals of a sustained growth recovery in the coming months: the steady investment growth led by infrastructure projects, the improving labor market conditions boosting consumer spending, and the ongoing re-stocking process to lift production growth," said HSBC’s chief China economist, Qu Hongbin. | | | | | | Italy's Ilva may seek new investor in refinancing plan | | Ilva said last week that it is currently preparing a plan to secure the financial viability of the company, while also considering the opportunity to open the doors to new investors. Italy’s largest steel producer, wholly owned by the Riva group, is preparing a possible recapitalization to enable it to finance the investments at its Taranto plant needed to meet the environmental requirements of the Italian government.
The market is also reporting rumours that a possible new investor could be coming from a major steel producer headquartered in India, China or Russia, but no official information was available and a source with knowledge of the situation said that a deal has not been finalised yet.
Nevertheless Bruno Ferrante, president of Ilva, stressed again in a statement that the company needs to see more clarity over the 1.7 million metric tons of semi and finished products, which are worth some €1bn and are currently seized due to a decision by a local magistrate.
The company concluded that it continues the meetings with local authorities, the Italian government and the unions to resolve the issue. | | | | | | Turkish HRC prices down by $10-20/mt on lack of demand | | Turkish hot rolled coil producers have entered February by lowering their offers $10-20/metric ton, following steep price hikes throughout January, Platts learned from participants on Friday.
“HRC prices swiftly climbed a mountain in the space of a month without getting sufficient support from demand, and are now rebounding to reasonable levels. Producers pushed up their prices to $650/mt ex-works to test the market; however, because there isn’t enough demand, transacted prices never reached that level. Producers are now lowering their offers. I heard a price of $625/mt ex-works from a major producer [last] week,” a trader said.
“I believe prices in the flat product market will follow the downturn in Turkey’s long product segment in the coming weeks. HRC prices especially rose too much in a month, while raw materials prices in January didn’t reflect this increase. You cannot sustain these levels without demand support. I expect HRC ex-works prices will go as low as $600-620/mt in February,” another trader observed.
Turkish mills’ HRC offers to the local market are now at $620-640/mt ex-works. Producers are asking for $720-730/mt ex-works for cold rolled coil, $800-820/mt ex-works for 0.5mm thick hot-dip galvanized coil and $940-960/mt ex-works for 0.5mm thick 9002 code colour-coated galvanized coil (PPGI), Platts learned from market sources.
The latest HRC offers from Ukraine are at $550-570/mt FOB Black Sea, while Russian offers have reached $570-590/mt FOB, Platts heard. | | | | | | Ilva restarts some coil lines in Taranto | | The Italian integrated steel producer Ilva is restarting the pickling and galvanizing lines at its Taranto works today (Monday 4 February), while the future of the company remains uncertain due to the decision of a local magistrate to seize 1.7 million metric tons of semis and finished products at the site (see related article).
These lines are resuming operation together with the spiral-weld pipe mill at the site, as previously reported, according to a union source at Taranto.
The zinc-coating will work at full capacity (21 shifts out 21), but the source noted that it is not clear how long the line will continue producing, while the pickling line is expected to be operating for two weeks every month (10 shifts out 21).
Most of the finishing lines at the plant were idled in November, with the exception of the hot strip mill number 2, which continues operating. | | | | | | Flat product imports into Turkey fall 2% in 2012 | | Turkish flat rolled steel imports declined 1.9% year-on-year in 2012 to 5.05 million metric tons, according to Turkish statistical Institute (TUIK) data.
Imports of hot rolled flats last year were down 1.6% to 3.36 million mt, with Ukraine the main supplier (812,698 mt), followed by Russia (527,669 mt) and Romania (520,810 mt).
However, cold rolled flats imports increased 18% over 2011 to 638,175 mt, with Russia the main origin (268,00 mt), followed by Belgium (95,640 mt), and Ukraine (60,580 mt).
Coated flats imports were down 8% in 2012 to 682,990 mt, as a result of increased domestic production capacity, sources told Platts on Friday. Belgium was the main source (131,850 mt), followed by South Korea (93,520 mt) and Italy (71,600 mt). Meanwhile, imports of narrow strip below 600mm width increased 8.8% to 359,560 mt.
Turkish traders believe overall flats import tonnages will continue on a decreasing trend in 2013, on account of growing domestic production capacity. | | | | | | Turkish flat product imports down 20% in Dec on local output | | Turkish flat rolled steel imports continued their decreasing trend in December, falling 20% on the previous month to 355,770 metric tons. This was due mainly to seasonal factors and increased domestic production capacity.
Platts was informed by the Turkish Statistical Institute (TUIK) that hot rolled flat steel imports declined 17% month-on-month in December to 227,518 mt. France (47,600 mt), Russia (44,730 mt) and Ukraine (40,310 mt) were the main sources.
Turkish cold rolled flats imports fell a steep 30% over November to 35,985 mt. Russia (18,370 mt), Belgium (8,525 mt) and South Korea (2,550 mt) were the main origins.
Coated flats imports in December declined 25% m-o-m to 59,570 mt. Belgium (11,270 mt), South Korea (7,900 mt) and France (7,025 mt) were the main sources. Turkey also imported 32,700 mt of narrow strip below 600mm width that month, down 12.5% m-o-m. | | | | | | Liepajas in talks with Latvian state on debt restructuring | | Latvian rebar producer Liepajas Metalurgs (LM) has approached the country’s government to ask for help with solving its financial difficulties and restructure its long-term debt, the steelmaker and the Latvian government told Platts.
The problems started after the company began repaying a LVL 60 million (€85.6m) loan to the creditor UniCredit last year. With the next instalment due in March, the mill is facing short-term liquidity problems and turned for help to the government, which is the guarantor of the loan. The money was borrowed to finance the modernisation of the meltshop and revamping of auxiliary production units, the mill said.
“Until recently there were no signs of problems as regards as repaying the state-guaranteed loan. Nevertheless, after Liepajas Metalurgs’ plea to the government to become involved in solving company’s financial troubles, the prime minister has asked the state treasury to look into possible solutions, which include debt restructuring, reviewing conditions of the loan etc.," the press secretary to Latvia's prime minister told Platts.
“This is the largest employer in Liepajas and a strategic company in Latvia, so we are trying to find the best solution to help it”, the PM’s secretary commented. The government has appointed an independent auditor to conduct diligence on the steelmaker and determine the root of the problem.
A representative of the country's treasury suggested that the situation results from "the common crisis of EU steel industry, which is struggling against falling demand and high operational costs". Other sources in the Latvian government also mentioned "disputes and litigation between Liepajas Metalurgs owners" as a factor playing against the troubled steelworks. | | | | | | Nursan in Turkey restarts EAF after maintenance upgrade | | Turkish long steelmaker Nursan restarted its electric arc furnace on January 31 after idling the unit in late-January for annual maintenance and in order to install a second oxygen plant to decrease energy costs, a company source told Platts on Friday.
"The furnace started to work [on January 31]," the source said. "The reason for the stoppage was maintenance and the commissioning of our second oxygen plant; with a larger oxygen capacity we will be able to lower our cost of production."
The 1.3 million metric ton/year capacity mill produces rebar as its finished product and is located in southern Turkey’s steelmaking region near Iskenderun.
During the period of the shutdown, the mill was seen booking a significant tonnage of billet on the international markets, although these are unlikely to have arrived yet at the plant and therefore will not have been used for rolling over the period of the maintenance. | | | | | | Outokumpu plans to align alloy surcharges from March | | The recently combined stainless steel producers Outokumpu and ThyssenKrupp Nirosta have issued separate alloy surcharge price lists for February, but plan to align them from March, according to a notice published on the Nirosta website.
The alloy surcharges for flat rolled stainless products are calculated on actual raw material prices, Nirosta said. “The production of material, invoiced in the first month after merger with Outokumpu, is based on conditions for purchasing and production of the old companies,” the notice said. “To pass on fair and realistic prices for raw material to our customers, we decided to publish two separated alloy surcharge tables in January and February 2013.”
“From March we are trying to present a merged alloy surcharge table to our customers,” it added. For the moment both surcharge tables are valid.
Acciai Speciali Terni – the Italian producer formerly owned by ThyssenKrupp, and which is now awaiting a new owner – continues to issue its own list of alloy surcharges.
In practice there is only marginal variation between most of the three companies’ surcharges for February (see table below). For type 304 products Outokumpu’s alloy adjustment factor of €1,277/metric ton is 1.8% less than Nirosta’s €1,300/mt. There is a bigger variation in type 430 where Outokumpu’s surcharge is 7.7% less than Nirosta’s. | Stainless alloy surcharges | | | €/metric ton, effective for February 2013 | | | | Type 304 | Type 316 | Type 430 | | Outokumpu | 1,277 | 1,930 | 418 | | Nirosta | 1,300 | 1,963 | 453 | | Terni | 1,298 | 1,960 | 456 | | | | | | | Turkish scrap imports up 6% in 2012 to 22.4 million mt | | Turkish steelmakers imported 22.42 million metric tons of scrap in 2012, up 6% year-on-year, with 73 countries contributing to the total intake and some change in the top supplier countries, figures from the Turkish Statistical Institute (TUIK) show.
The USA remained the largest single supplier of scrap over the course of the year, selling 6.3 million mt to Turkey’s steel mills, or around 28% of the total volume. UK merchants sold 2.42 million mt to Turkey, equating to 10.7% of imports.
This marginally pushed Russia into third place in the supply list. Russia exported 2.33 million mt to Turkey in 2012, roughly 10.3% of the total. Holland exported 1.90 million mt, while Romania dropped to two places to fifth on the supply list, selling 1.81 million mt to Turkey in 2012.
Overall value of Turkey’s scrap imports was $9.419 billion, which means the average price was $420.2/metric ton CFR Turkish ports over the course of the year.
In terms of regions of supply, the Baltic nations exported 924,935 mt last year. Scandinavia sold 826,669 mt. Spain and Italy exported 348,651 mt, as their domestic steel industries both contracted in 2012. The East Mediterranean also sold significant quantities, with Israel and Lebanon selling a combined 676,349 mt in 2012. | Top-5 scrap suppliers to Turkey in 2012 | | | | | | | million metric tons | | USA | 6.297 | | UK | 2.419 | | Russia | 2.325 | | Holland | 1.897 | | Romania | 1.805 | | | | | | | Scrap imports into Turkey up 3.4% on-month in December | | Turkish scrap imports in December rose slightly on-month to reach 1.79 million metric tons, recovering 3.4% on the previous month’s import tonnage, but significantly lower than the 2.1 million mt imported in December 2011, numbers from the Turkish Statistical Institute (TUIK) show.
The figures, released on Friday, show the USA maintained its regular place as the biggest single-nation provider of scrap to Turkey, selling 387,702 metric tons to the East Mediterranean country in December. Russia was the second-largest supplier at 273,023 mt.
Holland was third at 218,017 mt, while a host of other EU-27 nations contributed a significant tonnage. Belgium sold 167,329 mt, while the UK exported 188,205 mt and Romania sold 148,643 mt in December.
The statistics demonstrate the increased diversification of supply Turkish mills managed to obtain in 2012. Countries in the Adriatic exported significantly more than in previous years, while southern European merchants were considerably more involved: Spain, for instance, sold 35,079 mt in December to Turkish steel mills. 47 countries contributed to Turkey’s scrap imports that month.
The total value of Turkish scrap imports in December came to $694.7 million, with the mean average at $387.3/mt, around $3/mt higher than in November. | Top-5 scrap exporters to Turkey | | | December 2012 | | | | Metric tons | | USA | 387,702 | | Russia | 273,023 | | Holland | 218,017 | | UK | 188,205 | | Belgium | 167,329 | | | | | | | US, Canadian rig counts both rise for 2nd straight week | | The US rig count increased for the second consecutive week, while the Canadian rig count also increased but at a slower rate than previous weeks, according to the latest Baker Hughes rig count.
The US added 11 rigs from the previous week to total 1,764, but remained below last year’s level by 233 rigs. Working oil rigs in the US increased by seven, while rigs geared for gas production dropped by six.
Texas and Oklahoma had notable weekly increases of seven and six respectively, whereas Louisiana dropped three rigs. Also, Arkansas, Pennsylvania and Wyoming saw their rig counts decrease by one a piece.
The Canadian rig count gained four new net rigs for a total of 625, still 85 rigs below 2012’s equivalent count. | | | | | | February US scrap price deals could vary by region | | The US scrap market in February could vary region to region due to a mix of weather conditions throughout the country, transportation issues and the variety of prices settled upon for January requirements.
Last month, Midwest and Southeast scrap prices trended mostly sideways while the Northeast saw about a $10/long ton uptick based on strong export demand. That demand has since dissipated with export prices to Turkey moving down about $15/mt on a CFR basis since early January. US East Coast dockside prices declined $5/long ton last week and there was at least one small volume deal done between a scrap dealer and an East Coast steel mill at down $5/lt.
“It could be a regional month,” one Southeast scrap source said. “If you talk to someone in Buffalo and in Florida and in the Midwest, you might hear three different numbers. There is no continuity right now.”
Also, low water levels on the Mississippi River continue to create challenges by preventing some scrap barges from moving from the Midwest to the Southeast. The low water levels are keeping a lot of scrap in the Midwest and forcing southeastern US scrap buyers to source their material from other regions.
Many market participants continue to anticipate an overall soft-sideways market.
Speaking on an earnings conference call last week, Nucor CEO John Ferriola said, “It’s a very regional business, and in this particular season, more than in the past, we’ve had a lot strange weather that’s occurred regionally so there’s a lot of different impacts on different regions of the country.” | | | | | | Gerdau expands scrap footprint in mid-Atlantic region | | Gerdau Long Steel North America has completed the acquisition of certain operating assets of Virginia-based scrap recycler Cycle Systems Inc., in an effort to expand its scrap footprint in the competitive mid-Atlantic region.
Cycle Systems has nine scrap yards throughout central and western Virginia. In 2011 it processed 160,000 long tons of ferrous material and about 25,000 lt of non-ferrous.
“This purchase supports our goal to minimize billet cost by having scrap sources closer to our steel mills,” Gerdau Long Steel North America president Guilherme Johannpeter said in a release. “It will be a great advantage for our mill in Petersburg, Virginia and other nearby operations.”
Gerdau tells Platts it is in the process of transitioning Cycle Systems’ name and brand to that of Gerdau. | | | | | | US manufacturing PMI grows on new orders, inventories | | US Manufacturing Report on Business | | | January 2013 | | | | January | December | Change | | PMI | 53.1 | 50.2 | +2.9 | | New Orders | 53.3 | 49.7 | +3.6 | | Production | 53.6 | 52.6 | +1.0 | | Employment | 54.0 | 51.9 | +2.1 | | Supplier Deliveries | 53.6 | 53.7 | -0.1 | | Inventories | 51.0 | 43.0 | +8.0 | | Customers' Inventories | 48.5 | 47.0 | +1.5 | | Prices | 56.5 | 55.5 | +1.0 | | Backlog of Orders | 47.5 | 48.5 | -1.0 | | Exports | 50.5 | 51.5 | -1.0 | | Imports | 50.0 | 51.5 | -1.5 | The US manufacturing sector expanded at a faster rate in January, as manufacturers reported more new orders and inventory growth, according to the monthly Institute for Supply Management business report.
The purchasing managers’ index grew for the second month to 53.1 in January on December’s index of 50.2. Readings higher than 50 signal expansion; those below 50 indicate contraction.
“Manufacturing is starting out the year on a positive note, with all five of the PMI's component indexes — new orders, production, employment, supplier deliveries and inventories — registering above 50% in January," said Bradley Holcomb, chairman of the ISM Manufacturing Business Survey Committee.
The new orders index pulled out of contraction with a January rating of 53.3, up from 49.7 in December. Inventories also increased by a large margin – 8 points – reaching 51 in January, compared to December’s fast-contracting rating of 43.
Production picked up to a rating of 53.6, compared to 52.6 in the prior month.
The prices rating has been increasing for six months and reached 56.5 in January, compared to 55.5 in December. In January, ISM found stainless steel sheet and cold rolled steel to be among the commodities that were up in price, while general steel prices were down.
Exports are growing at a slower rate than in December, as January’s rating was 50.5, compared to 51.5 in December. Imports are relatively unchanged with a rating of 50, compared to 51.5 in December. | | | | | | Danjczek to step down as SMA president at year-end | | The long-time president of the Steel Manufacturers Association, Tom Danjczek, plans to retire from this position at the end of the year and will serve as an advisor to the US mill group after he retires.
Danjczek has served as SMA’s president for 15 years. Nucor CEO John Ferriola, SMA’s chairman, said in a statement that Danjczek "has had an outstanding record of achievement at the SMA growing the organization and adding value to the membership in safety, environment, trade, energy, transportation and other public policy matters.”
The SMA board has begun its search for Danjczek’s successor. | | | | | | ArcelorMittal could upgrade Mexican distributor | | ArcelorMittal is considering the possibility of upgrading its Tultitlán distribution center in Mexico and transforming the facility into a service center to process steel for the national market, a company spokesman confirmed to Platts.
"We are only evaluating the possibility and there is nothing defined yet," said the executive. "It would be a service center for the distribution of our products, to speed up the supply to our customers."
No estimates of timing or funding were disclosed.
According to the executive, the unit, which is based about 40 km from Mexico City, "runs more as a warehouse than a distribution center, since no fixed amount of steel products are handled." | | | | | | 2012 US construction spending up 9.2% year on year | | The US spent 9.2% more on construction in 2012 than in 2011, according to Census Bureau data released on Friday.
The value of construction last year was $850.2 billion, compared to $778.2 billion in 2011. Private construction spending increased by 16.1% year on year to $574.6 billion in 2012, compared to $495 billion in 2011. Public construction spending, however, decreased by 2.7% year on year, falling to $275.6 billion from $283.3 billion.
Total public and private residential construction increased 15.4% year on year, reaching 283.4 billion in 2012 from $245.7 billion in 2011. Nonresidential construction spending increased by 6.4% in 2012, climbing to $566.8 billion on 2011's $532.6 billion.
The seasonally adjusted annual rate for private construction in December was $614.9 billion, 2% higher than the estimated annual rate in November, $602.9 billion.
The seasonally adjusted annual rate for public construction was $270.1 billion, 1.4% less than the revised November estimate of $274.1 billion. | | | | | | Sidor to supply local industry amid raw material shortage | | Venezuela's largest steelmaker Sidor will put its focus on its pellets plant in the next few weeks in an effort to minimize the impact of a shortage of raw materials in the country, said company president Rafael Gil Barrios.
The pellet shortage worsened recently with CVG Ferrominera Orinoco’s pellet plant outage due to an operating problem, putting the site "under maintenance."
After a meeting with industry representatives, Sidor decided to support other steelmakers and HBI producers with its pellets output, at least while FMO’s 3 million mt/y pellets plant is paralyzed.
Sidor stated its second pellets producing line could be restarted soon to increase availability, which would help to supply demand in the Guayana region.
In addition, Barrios said the investments approved for state-owned Sidor by Venezuela President Hugo Chávez, an amount totaling $314 million, is being invested slowly in areas of major need, such as the lime/limestone plant, the pellets plant and steelmaking areas. | | | | | | Colombia not keen on investments in railways | | The Colombian government does not look forward to driving direct investments into the construction of railways, said Jorge Gabriel Taboada Hoyos, corporate general manager for the development of the Carare railroad.
Speaking during the Colombian national mining conference in Bogotá, he said, "The country’s administration considers these as private investments, and that the companies would benefit from the expenditures they would make."
There is a need for more Colombian railroads to reduce transportation costs and help develop the extraction of metallurgical coal from areas that lack reasonable access to ports, such as central Colombia, industry sources contend.
As previously reported, more than 1.5 billion mt of metallurgical coal is being left underground in the the northern Colombian states of Boyacá, Cundinamarca and Norte de Santander due to the lack of investment in infrastructure.
| | | | | | Ezz Steel raises HRC price as local currency falls further | | Egyptian steelmaker Ezz Steel has raised its hot rolled coil price EGP 440/metric ton ($66) for February bookings over the previous month to EGP 4,840/mt ($721) ex-works, including 10% sales tax. This can be explained by the continuing depreciation of the local currency against the dollar, which is making raw materials costlier for mills to import and eliminating finished product imports, market participants told Platts last week.
The plummeting Egyptian pound – seen on Friday at 6.7 per dollar, down from 6.4 on January 1 – is rendering HRC imports uncompetitive and giving local producers impetus to push for higher prices. “There is no courage to import; because of the fluctuating exchange rate, you cannot calculate costs accurately,” a local trader said.
Russia’s Severstal is reported to be offering ST37 grade 2mm thick and above HRC at $640/mt CFR Alexandria actual weight, while Turkish suppliers are pricing the product at $650/mt CFR; however, there have been no takers at these levels. Saudi Arabia’s SABIC is recently said to have sold 20,000 mt of HRC to its exclusive Egyptian agent, the trader said, without being able to give the price. However, it would not be representative of the market as SABIC’s material is not available to everyone, he observed.
Despite iron ore firming last week the extent of recent HRC price hikes by foreign and local mills is unjustifiable, the trader observed. “There is not as much offering as usual, maybe because producers are holding back material. It looks like 2008: little material availability and no price ceiling,” he said. Platts recalls that in 2008 HRC prices soared to over $1,200/mt before plunging to below $500/mt.
On the export side, Ezz Steel is said to have achieved recent sales of 1.2mm thick HRC to Saudi Arabia at $710/mt FOB. This size commands a $70/mt premium over 2mm base material. However, Turkish coil buyers have recently re-stocked, while demand in Europe remains weak, meaning Ezz’s HRC export price increase must be gradual if it wants to achieve business. One trader forecast Ezz offering at $650/mt FOB base this week.
Consumption in Egypt remains affected by social unrest. “There is no HRC demand to speak of in Egypt. Once the political situation calms down and the economy returns to normal, then we can speak about the market again,” another trader said. | | | | | | New Algerian rebar mill starts cold tests, prepares start-up | | The new mini-steelworks located in Oran, Algeria, and controlled by Turkish group Toscelik, started the cold testing phase last week and expects to be ready for hot start-up by the beginning of March, Platts learned from the supplier of the equipment, CVS Technoligies.
Last week cold tests started at the meltshop, while cold tests for the rebar rolling installations are expected to start at the end of this week. The hot start-up is currently planned for the first days of March, a senior source at the site said.
An exact timing for the final launch of the production at the mill is not yet available, but it is believed to be approaching. The source said that currently the tests are done using temporary electricity generators and that the entire project will be concluded when the main power line will be completed, by the owner of the project.
This new mill will have a capacity of 1 million metric tons/year crude steel when ready. It will supply the light long market for construction in Algeria, which is currently mainly dependant on imports from European producers. | | | | | | US domestic, Turkish, Indian import scrap prices slip - TSI | The latest scrap reference prices released by The Steel Index (TSI) last Friday show that its weekly US scrap reference price fell by 0.8%. The weekly average of its daily Turkish scrap reference prices dropped by $6/metric ton since the previous week, with the daily Turkish reference price moving steadily downwards during the week. The Indian containerised weekly scrap reference price also slipped slightly. In the US, the weekly domestic shredded obsolete scrap reference price fell by $3/long ton to $387/lt delivered US Midwest mill. Although the onset of winter weather slowed collection rates, new sales were concluded at slightly lower levels. This reference price is 1% or $4/long ton below the level of four weeks ago. The weekly average of daily Turkish scrap import reference prices was 1.5% below last week's average. UK and North American material was concluded by the few mills in the market, while European suppliers stayed quiet. The weekly reference price is $5/mt lower than the level published four weeks previously. TSI's daily price weakened early and at the end of the week and finished $8/mt below the previous week's level. The weekly Indian containerised shredded scrap import reference price turned around and decreased by $4/mt or 0.9% from last week's level. Traders snapped up lower-priced material as offers from US and Europe dropped in line with the international market. This reference price is $21/t higher than four weeks ago, reflecting the recent strong increases. TSI - a separate pricing unit within Platts - specialises in compiling steel, iron ore and scrap reference prices by collecting and averaging actual transaction data. Further details of TSI's methodology can be found on its website www.thesteelindex.com. | | | |  | |
