| Indian & world foundry news May-23 |
|
May 23, 2013
Chinese share of hot metal production through BF route crosses 60%
Chinese steel price index further crashes by 17 points on May 22
China construction steel transactions not see marked improvement
SCHMOLZ+BICKENBACH AG marked improvement in earnings situation for 2013
TATA Steel seeking partner to help run Scunthorpe works - Report
London copper near 2 week top on hints Fed stimulus will stay
Aluminium chief to leave Glencore Xstrata
Copper selling seen as prices outperform aluminum - Citigroup
Iran government moves to impose steep export duty on iron ore
Iran Steel Market Trend in Week 20 - Flat Products
SSGC again serves notice on Pakistan Steel Mills
Iron ore bounces off 2013 low as weak steel market may cap gains
Worldsteel update on crude steel production in CIS
Outokumpu launches new formable duplex grade - the FDX product family
US Steel annual net profit down in 2012 - May 23
According to US Steel Košice’s annual report, sales of the company dropped from EUR 2.605 billion in 2011 to almost EUR 2.48 billion last year.
The firm said that “The improvement of economic performance for 2012 against 2011 reflects the influence of lower prices of raw materials and an increase in the volume of orders that were partly offset by a drop in sales prices and an increase of energy prices."
US Steel Košice produced 3.5 million tonne of pig iron last year and 4 million tonne of slabs. The steelmaker had considered leaving Košice due to the end of its tax holiday, growing energy costs and stricter environmental regulations. The company is obliged to rebuild three coal-fired boilers to propel its power plant’s turbines by 2016, in compliance with measures introduced by Brussels.
The Slovak government and US Steel signed a memorandum on the steelmaker’s continued presence in the eastern Slovak metropolis. The government promised the company a reduction in energy and environmental fees.
US Steel Košice was set up after US Steel Corporation took over the metallurgical plant, VSŽ, in June 2000. Together with its affiliations, the company is one of leading manufacturers of flat-rolled products in Europe, supplied chiefly to the automotive, engineering and electro-technical industries. The main business line of U.S. Steel Košice is the production of steel, flat-rolled steel products, spiral welded pipes and radiators. On the whole, it employs approximately 11,000 workers.
(Source - www.steelguru.com)
Romania taking part in working out European Steel Action Plan - May 22
Mr Varujan Vosganian, Economy Minister, said that Romania will take part in working out a Steel Action Plan alongside the other European Union members, thus making the preparatory moves for taking up the EU presidency in 2019.
Mr Vosganian said that “The Romanian administration should begin the preparatory moves for 2019, when Romania will hold the European Union presidency. We are halfway between 2007 and 2019. Our ministers will chair the specialized commissions for energy, industry, competitiveness, ECOFIN. We will have committees to make assessments and draw up the European documents. Romania must put forward a platform of priorities. Curbing bureaucracy, the fight against corruption, a professional administration will have to be characteristics of the Romanian administration in 2019. Romania will have to be more powerfully committed to the decision making than today.”
The Action Plan is being worked out by Romania, France, Belgium, Luxembourg and Poland.
He said that “The steel industry policy is one of the policies we have got involved in and it seems it will be finalized in June. We, together with a few other countries, with France, Belgium, Luxembourg and Poland have proposed to work out an action plan for the steel-making industry.”
He added that “In Brussels, yesterday I spoke to the European Commissioner for Industry and Entrepreneurship Antonio Tajani. We'll present the plan for supporting the EU steel industry in June. I again underscored the need to draw up a common industrial policy in the EU. I will unveil the final document in a few weeks. The support program is ambitious and ranges from the assessment of the impact of each normative act to evaluating the energy cost, the regulations regarding the scrap iron export, curbing the tax evasion and the workforce', the minister explained.”
Meanwhile, the Action Plan will be showed the EU industry ministers in June and then handed in the European Commission
(Source - www.steelguru.com)
Steel manufacturer industries coming to Lackawanna - May 21
WIVB reported that a company that will supply materials to hydro-fracking sites out of state is opening shop in Lackawanna.
The process of drilling for natural gas, known as fracking, is still not allowed in New York, but it is in most states, and a Canadian company sees Lackawanna as strategic location to serve that market.
Over the past 6 months, a large factory has been built under the windmills in Lackawanna along Fuhrmann Boulevard. It's barely visible from Rt. 5.
Lackawanna Mayor Mr Geoffrey Szymanski said that "This is the first steel industry that's coming back to Lackawanna since the steel plant closed 30 years ago, almost to the month."
The company is called Welded Tube of Canada and has found its niche making long steel tubes for oil and gas drilling. It has been sending so many of their pipes down south through Western New York, that an old Bethlehem Steel property seemed like a perfect location to set up a new US factory to service this booming industry. Mr Robert Mandel president of Welded Tube of Canada said that "There is clearly at times, a demand for US made product and hence we could meet that requirement as well by being in the US."
Brand new rail lines will allow Welded Tube to ship their tubes directly down to Pennsylvania and Ohio, where the fracking industry is thriving.
Mr Szymanski said that "We are relocating the new rail lines with the assistance of the County Executive, new gas lines, water lines in order to accommodate Welded Tube and new industry that's looking to piggy-back off this operation."
The building will be finished by July and manufacturing pipes by September. Welded Tube plans to hire 40 workers by mid summer.
Mr Mandel said that "We are accepting applications. We have done some limited hiring to date but are very, very actively recruiting and searching for the employees we need."
He said that if you're interested in one of the factory or office positions, visit Welded Tube's website. The company may eventually employ over a hundred people for this USD 50 million investment.
Mr Szymanski said that the only downside to the deal is that the Erie County Industrial Development Agency enticed Welded Tube to the location by promising the company wouldn't have to pay any county or city taxes for the first seven years.
He said that "We worked diligently to help this company set up here, but the next few companies are going to have to pay their fair share of taxes because we're a city, we run off of money and when you run out of it, you run into hardships."
(Source - www.steelguru.com)
RHI Group Q1 2013 outlook May-17
In a stable macroeconomic environment and with unchanged exchange rates, RHI expects a higher level of revenues in the Steel Division for the Q2 of 2013, amongst other things due to the full consolidation of the Indian Orient Refractories Limited and in the Industrial Division slightly lower revenues than in the first quarter of 2013.
This is primarily attributable to the end of the cement season. The operating result margin is expected to be in the single-digit range due to changes in product mix, the higher share of revenues of the Steel Division and negative effects from lower capacity utilization.
For the full year 2013 RHI adheres to the outlook that revenues at a similar level as in 2012 and a further improvement in the EBIT margin can be realized.
The payment of USD 40 million received in the Q2 of 2013 will be recognized as income from restructuring in the income statement and will accordingly have a positive effect on EBIT.
Forming provisions related to the closure of the Duisburg plant leads to restructuring costs in the income statement, which will, however, be balanced out by the reversal of provisions related to the termination of the Chapter 11 proceedings of the deconsolidated US companies.
(Source - www.steelguru.com)
UK jobs fear rise after TATA Steel move on Europe operations May-16
The Independent reported that fresh fears over the future of UK steel jobs were raised after India's TATA Steel wiped EUR 1 billion from the value of its European operations.
Unions said that the huge write down will worry its 18,500 staff in the UK who are still reeling from 900 job cuts last year.
Mr Paul Talbot, from the Community trade union which represents many UK steel workers, said that "These statements are concerning, there's no question about it. They are concerning to the employees who at this moment are still working their way through the last announcement. It's no secret that the steel industry has been going through difficult times.”
Mr Talbot said that "Time after time we've been given assurances that TATA have to plans to cut back on investment in the UK again in any further restructure or closure of plants."
TATA Steel, which has UK operations at sites including Port Talbot, Rotherham and Scunthorpe, blamed the tough economy in Europe where steel demand has slumped by about a third since the start of the financial crisis.
TATA, which bought Anglo Dutch steel giant Corus in 2007 for EUR 6.2 billion, has endured a tough time during the downturn as demand from construction and car making dived, forcing thousands of lay offs and plant closures. It employs more than half its 33,000 strong European workforce in the UK.
(Source - www.steelguru.com)
Japan likely to invest in 6 key industries in Viet Nam May-15
VNS reported that the Japanese Government has pledged to invest in 6 key industrial sectors in Viet Nam.
The money will go towards household electricity, food processing, shipbuilding, agricultural machinery, environment and energy saving and the automobile and spare part production industry.
Ms Nguyen Thi Tue Anh head of the Central Institute for Economic Management's Business Environment and Competitive Capacity Department said that the selected sectors fell under Viet Nam's industrialization strategy in their co-operation program with Japan.
Accordingly, a range of support industries serving for the six key sectors would also be considered for financial assistance.
Viet Nam and Japan have built a supervisory system to monitor the program. Plans have also been made for the establishment of 2 industrial zones in the north and the south of the country in order to attract more Japanese investors
Ms Anh said that the Vietnam Investment Review that each sector will choose 2 or three sub-areas where the support is most needed. An action plan for each will then be designed.
She said that the food processing, agricultural machinery and shipbuilding industries have been unproductive and uncompetitive despite their potential.
In comparison, the household electricity and automobile sectors have seen rapid growth, contributing to exports and attracting many Japanese investors.
However, these sectors have focused mainly on the assembly phase due to a lack of support in other areas of operation. Meanwhile, the environment and energy industry has displayed huge potential for producing energy saving products
Ms Anh added that the expansion of the sectors should be closely linked with rising value, and supervised by the Government through industrial policies.
The selected industries were targeted so that they would be in a position to adapt to competition when the tariff barrier in the ASEAN Free Trade Area is lifted by 2018. The 6 sectors were chosen from a group of 39, all with long-term growth potential.
(Source - www.steelguru.com)
Mr Obama ready to expand natural gas exports May-14
As the US sets records for natural gas production, the specter of shortages and surging prices has been replaced by a debate over how much to sell overseas. The bounty has fueled speculation President Mr Barack Obama is ready to expand exports.
According to Energy Department data, sending liquefied natural gas to non US customers, unthinkable a few years ago when demand outstripped supply, is now seen as a way to help US trade and blunt the influence of producers such as Russia and Iran. The Obama administration is reviewing applications for 20 gas export terminals. If all win approval, the facilities could ship the equivalent of 41 percent of total US production this year.
Mr David Leiter, president of ML Strategies LLC, a Washington lobbying firm, said that a decision is possible in weeks and not months
Mr John Tobola, general counsel for Freeport LNG, said that the company expects action in this quarter on its bid.
According to Dow, the prospect of exporting gas has alarmed users such as Dow Chemical Company and triggered a lobbying battle with producers including Exxon Mobil Corporation, which want the market to determine how much is sold overseas. Too much gas for export will push up domestic prices, wiping out a competitive advantage US producers have over foreign companies.
Mr Spencer Abraham, a former US energy secretary who has worked with gas exporters since leaving office, in an interview, said that “We still have a psychology about energy that’s based on the very lengthy period of time when America was so dependent on imports that it was creating energy-security issues. Nobody would be advocating this if we only had 10 more years of natural gas supplies. The fact is that we have at least a century or more.”
The Energy Department said that US gas production, which has jumped 28% in the past decade, will average a record 69.9 billion cubic feet a day this year. Output will reach an all-time high for the sixth straight year on the surge coming from shale formations, such as the Marcellus in the Northeast.
Mr Kevin Kolevar, Dow’s vice president for government affairs and public policy, said that the US has sufficient supplies to send some overseas. Too many exports though could bring back price volatility, as domestic manufacturers and electric utilities compete with foreign customers for the same commodity.
Mr Kolevar said that “We are in a time a surplus, but we’ve seen moments of irrational exuberance before. We need to be thoughtful. With all the evidence we have today, we still could be wrong.”
(Source - www.steelguru.com)
Taiwanese steel pipe makers to cut export prices for July May-10
It is reported that the Taiwanese steel pipe makers are going to release its export prices for July.
It said that the Taiwanese steel pipe producers planned to cut export prices by USD 30 per tonne to USD 40 per tonne for July.
China Steel Corporation, one of the major upstream raw material suppliers to steel pipe makers will release its prices for July and August in end of May,
It added that CSC might reduce its list prices for hot rolled steel products by TWD 800 per tonne to TWD 1,000 per tonne..
Thus, the steel pipe makers set to reduce its export prices by USD 30 per tonne to USD 40 per tonne for July.
(Source - www.steelguru.com)
CMC announces Senior Notes offering May-08
Commercial Metals Company announced that it is offering to sell, subject to market and other conditions, USD 300 million aggregate principal amount of senior notes in an underwritten public offering under its effective shelf registration statement.
CMC intends to use the net proceeds from the offering to fund the repurchase of any and all of the USD 200 million aggregate principal amount outstanding of its 5.625% Senior Notes due 2013 in a cash tender offer and consent solicitation that it commenced today and to redeem any remaining 2013 Notes that are not tendered following the expiration of the tender offer and consent solicitation, in each case together with accrued interest, any applicable premium payments and related expenses. CMC intends to use the remainder of the net proceeds from the offering for general corporate purposes.
Citigroup Global Markets Inc, Deutsche Bank Securities Inc, Merrill Lynch, Pierce, Fenner & Smith Incorporated, RBS Securities Inc and Wells Fargo Securities, LLC are acting as joint book-running managers for the offering, and PNC Capital Markets LLC and Scotia Capital Inc are acting as co-managers for the offering.
Meanwhile, the offering is being made under an effective shelf registration statement on file with the US Securities and Exchange Commission. The offering may be made only by means of a prospectus supplement and the accompanying prospectus.
(Source - www.steelguru.com)
TATA Steel not to be blamed for collapse May-06
The MD of an important Newport firm said that steelmakers TATA cannot be blamed for the collapse of the firm.
In his first public statement since Rowecord Engineering went into administration, Mr Andrew Hoppe said that the firm was hit hard by the poor construction market.
Mr Hoppe said that "We’ve had very few orders in building structures and the publicly procured market for infrastructure bridges has also been depressed. The poor market outlook, together with difficulties with some current contracts in the construction sector has brought us to the conclusion that the Rowecord business is no longer sustainable.”
He said that “Rowecord had several major engineering projects which overran, including Blast Furnace No 4. These caused significant cash flow issues. But it should be stressed that TATA Steel’s Blast Furnace No.4 re-build project cannot be blamed for our decision.”
He added that "We have had difficulties with this challenging project, but these commercial issues were resolved some weeks ago when we settled with TATA Steel. At that point we were aiming to continue as a fully viable business." The company had settled with TATA Steel weeks ago over problems with the re-build of Blast Furnace Number 4 at Port Talbot. It comes after administrator Alistair Wardell told the Argus it was unlikely a buyer could be found for the company.
(Source - www.steelguru.com)
WorldAutoSteel unveils design tool for material comparison in automotive applications May-03
WorldAutoSteel, along with the Steel Market Development Institute, a business unit of the American Iron and Steel Institute, unveiled a new tool that enables vehicle designers to quickly and accurately evaluate material selection tradeoffs, including mass, cost and greenhouse gas emissions, for automotive applications.
The Design Advisor software was developed by Dr Don Malen of the University of Michigan’s College of Engineering to assist automotive decision makers in evaluating and selecting the material that best fits the requirements of a given application.
According to SMDI, the material selection for automotive components is complicated by several factors. Since material decisions for components influence the entire vehicle, Design Advisor helps the engineer understand how material decisions affect numerous criteria, including vehicle mass, cost, fuel economy and environmental impact.
Dr Malen said that “Since these criteria are not easily combined as a single objective number, the decision maker must be presented with potential effects on mass, cost and GHG emissions so appropriate tradeoffs can be evaluated and selected. The Design Advisor software provides decision makers with the ability to evaluate various materials at a vehicle system level.”
AISI serves as the voice of the North American steel industry in the public policy arena and advances the case for steel in the marketplace as the preferred material of choice. AISI also plays a lead role in the development and application of new steels and steelmaking technology.
(Source - www.steelguru.com)
US steel imports permits in April down by 3pct MoM May-02
Based on the Commerce Department’s most recent Steel Import Monitoring and Analysis (SIMA) data, the American Iron and Steel Institute (AISI) reported that steel import permit applications for the month of April total 2,576,000 net tons.
For the first four months of 2013 (including April SIMA and March preliminary), total and finished steel imports were 10,176,000 NT and 7,999,000 NT, respectively, down 13% and 11% from the same period in 2012.
April 2013 total and finished steel import permit tons would annualize at 30,529,000 NT and 23,998,000 NT, down 9% and 7%, respectively, vs. the 33,475,000 NT and 25,826,000 NT imported in 2012. The estimated finished steel import market share in April was 23% and is 23% year-to-date (YTD).
Finished steel imports with large increases in April permits vs. the March preliminary included cut lengths plates (up 74%), wire rods (up 45%), standard pipe (up 36%), cold rolled sheets (up 19%) and mechanical tubing (up 19%). Major products with significant year-to-date (YTD) increases vs. the same period in 2012 include steel piling (up 60%) and cold rolled strip (up 36%).
In April, the largest finished steel import permit applications for offshore countries were for South Korea (275,000 NT, up 18% from March), Japan (220,000 NT up 25%), China (124,000 NT, down 9%), Germany (114,000 NT, up 56%) and Turkey (72,000 NT, down 53%). Through the first four months of 2013, the largest offshore suppliers were South Korea (1,150,000 NT, down 7% from the same period in 2012), Japan (663,000 NT, up 0.1%) and China (571,000 NT, up 30%).
(Source - www.steelguru.com)
Hyundai Steel finished steel outputs down by 15pct in Q1 April-30
Korean second largest steelmaker Hyundai Steel said that its production of finished steel flats and longs totaled 3.37 million tons in the first quarter of this year, falling by 15% from a quarter ago..
In the first quarter of this year, the company’s total sales dropped by 16% quarter on quarter to 3.4 million tons.
Hyundai Steel’s production of steel flat products in the first quarter decreased by 21% quarter on quarter to 479,000 tons, caused by the maintenance in the C section at its Dangjin works.
It’s known that the company started an expansion plan at the C section’s hot strip mill to raise the capacity to 5.5 million tons per year.
Meanwhile, the company’s output of steel long products dropped by 7% from a quarter ago to 1.61 million tons, due to weak demand from the country’s construction industry and low-priced imports from China
(Source - www.steelguru.com)
Indonesia may re-review AD duty on CRC - April 29
It is reported that Indonesia planned to re-investigate the anti-dumping duties on cold rolled coil from Japan and other countries.
Last month the country decided to penalize imports of carbon steel cold rolled coil and sheet products with anti-dumping duties of up to 55.6% for three years from March 19th, according to source reported.
Meanwhile, Japan to address that Japan’s CRC exports do not harm local producers.
However, the Japanese government will continue encouraging Indonesia to re-examine the matter because the decision is neither fair nor acceptable to us.
Currently, Indonesia has imposed AD duty on cold rolled coil from Nippon Steel & Sumitomo Metal Corp. (NSSMC), Kobe Steel and Nisshin Steel.
(Source - www.steelguru.com)
Toyota Motor still world No 1 in global vehicle sales - April 26
It is reported that the current drop in copper prices below USD 7,000 per tonne is likely to have an effect on the availability of foreign exchange on the Zambian market thereby adding more pressure on the Kwacha.
The Copper shipments out of Zambia, which have resumed after a two week export halt because of a railroad accident on Tazara on the 9th April will bring about additional supplies of copper which will arrive in a market in which stockpiles of extra copper are already on the rise. The amount of the metal held in warehouses overseen by the London Metal Exchange rose 2,000 tonnes to 614,350 tonnes up 92% this year.
Copper prices have been in decline for much of this year as investors wagered that supplies from new and expanded copper mines would overwhelm demand from manufacturers. These fears escalated at the start of the week after China reported slower than expected economic growth for the Q1. China is the world’s top copper consumer accounting for about 40% of global demand. Its gross domestic product expanded 7.7% in the Q1 a slowdown from 7.9% in the final quarter of 2012.
Mr Matt Zeman head of trading with Chicago brokerage Kingsview Financial said that “Copper is telling us right now that all is not well with the global economy. If people still look at copper as a barometer of economic activity, we’re in for some rough times ahead.”
(Source - www.steelguru.com)
Toyota Motor still world No 1 in global vehicle sales - April 25
It is reported that Toyota is still the world's No. 1 automaker in global vehicle sales after the Q1 2013, although the 3 way race with General Motors and Volkswagen is proving tight..
Toyota Motor Corporation said that it sold 2.43 million vehicles during the January-March period, outpacing US automaker General Motors Company at 2.36 million vehicles and Volkswagen AG of Germany at 2.27 million vehicles.
The Japanese maker of the Prius hybrid and Camry sedan reclaimed its crown as world's top automaker last year, after losing it to GM a year earlier, when it was battered by the tsunami and quake disasters in northeastern Japan.
(Source - www.steelguru.com)
Southern Copper declares quarterly dividend - April 24
Southern Copper Corporation announced quarterly dividend. Shareholders of record on Wednesday, May 8th will be paid a dividend of USD 0.20 per share on May 21st. This represents a USD 0.80 annualized dividend and a dividend yield of 2.47%. The ex dividend date is May 6th 2013.
A number of analysts have recently weighed in on SCCO shares. Analysts at Citigroup cut their price target on shares of Southern Copper Corporation from USD 41.00 to USD 37.00 in a research note to investors on April 15th. They now have a neutral rating on the stock. On related note analysts at JPMorgan Chase upgraded shares of Southern Copper Corporation from a neutral rating to an overweight rating in a research note to investors on April 8th.
Finally, analysts at FBR Capital Markets initiated coverage on shares of Southern Copper Corp in a research note to investors on April 5th. They set a market perform rating and USD 32.00 price target on the stock. One research analyst has rated the stock with a sell rating, five have assigned a hold rating and two have issued a buy rating to the company. The company has a consensus rating of Hold and a consensus target price of USD 39.00
Shares of Southern Copper Corporation traded up 1.19% during mid day trading hitting USD 32.37. The company has a 52 week low of USD 27.72 and a 52 week high of USD 42.03. The stock’s 50 day moving average is currently USD 35.8. It has a market cap of USD 27.370 billion and a P/E ratio of 14.03.
Southern Copper Corporation last posted its quarterly earnings results on January 31st. The company reported USD 0.63 EPS for the quarter, beating the Thomson Reuters consensus estimate of USD 0.62 by USD 0.01. The company had revenue of USD 1.65 billion for the quarter, compared to the consensus estimate of USD 1.65 billion. During the same quarter last year, the company posted USD 0.63 earnings per share. Southern Copper Corporation’s revenue was down 1.1% compared to the same quarter last year. On average, analysts predict that Southern Copper Corporation will post USD 2.52 earnings per share for the current fiscal year.
(Source - www.steelguru.com)
India eager to join Iran and Pakistan gas pipeline - April 23
It is reported that since India has been motivated by Pakistan’s seriousness in building the ‘peace pipeline’, New Delhi is negotiating to join the project.
The Iranian official added that there has been considerable progress in the Iran Pakistan pipeline, with Iranian contractors starting work on the Pakistani section of the pipeline, after finishing nearly 900 kilometers of the pipeline on Iran soil.
In March, Indian Minister of Petroleum and Natural Gas Mr M Veerappa Moily voiced his country’s willingness to join the pipeline project.
The pipeline will enable the export of 21.5 million cubic meters per day of Iranian natural gas to Pakistan.
The Pakistani government has stressed that it would go ahead with the construction of the gas pipeline despite threats and pressure from the U.S.
(Source - www.steelguru.com)
Nigeria targeting 12 million tonnes of liquid steel by 2020 - April 22
Mr Goodluck Jonathan President of Nigeria said that Federal Government had developed an industrial blue print to ensure the complete development of the iron and steel industry to serve as a catalyst for the domestic and industrial development of the country.
Mr Jonathan spoke after commissioning the 700,000 tonnes 5-Stand Tandem Cold Rolled Steel Plant, built by Wempco Steel Mill Limited at Ibafon, Ogun State, noting that the country would be producing about 12 million tonnes of liquid steel by 2020.
He said that steel was one of the most important materials used widely for both domestic and industrial purposes throughout the world, explaining that this was why the Federal Government planned to develop the complete ecosystem of this sub-sector.
He added that his administration has approved the Minerals and Metals Development Road Map, which was recently presented to the public stipulating time-bound targets for the sector, the strategies to be adopted would ensure the accomplishment of the set objectives of increasing steel production of three million tonnes of liquid steel by the end of this year and progressively increase to 12 million tonnes by 2020.
According to him, the steel sector was at the heart of his administration's national development endeavor.
He concluded that the building of the steel plant as the single largest private sector investment in the steel sector, and a another milestone in our determination to reposition our steel sector to play a pivotal role in our match towards industrialization and national transformation.
(Source - www.steelguru.com)
US steel use growth rates to halve in 2013 - April 19
It is reported that growth rates in the use of steel throughout North America are set to drop back by more than half in 2013 after demand for the building material surged on strong levels of manufacturing and a pick up in construction activity.
However, stronger demand in other parts of the world may mean a return to upward pressure on prices.”
Releasing its quarterly Short Range Outlook, the World Steel Association said that overall volumes of ‘apparent steel use’ throughout the North American Free Trade Agreement region increased by 7.8% last year amid strong activity in US energy and car manufacturing and an increasingly resilient building recovery in that country, with high levels of construction output in Canada adding to momentum.
Worldsteel said that US fiscal constraints will see usage growth will drop back to 2.9% and remain at around this level in 2014.
Though the Association does not give separate forecasts for Canada, recent reports suggesting a return to more normal levels of housing construction activity and moderating manufacturing conditions mean the prospect of any big increase in demand is unlikely.
By contrast, from a global perspective, overall steel use growth rates are expected to pick up after remaining virtually stagnant last year as demand strengthens again in China and poor manufacturing and construction conditions in Europe stabilize.
Mr Hans Ju̎rgen Kerkhoff chairman of Worldsteel Economics Committee said that overall demand for steel rose by just 1.2% in 2012 as the impact of the European crisis spread and significant emerging economies slowed amid corrective macroeconomic policy.
Mr Kerkhoff said that “However, in the early part of 2013, the key risks to the global economy, the Eurozone crisis, a hard landing for the Chinese economy, and the US fiscal cliff issue have all stabilized considerably and we now expect a recovery in global steel demand to kick in by the second half, led by the emerging economies,” though he also cautioned that recent events in Cyprus underscore Europe’s continuing fragility.
He said that “In 2014, we expect a further pickup in global steel demand with the developed economies increasingly contributing to growth.”
In its forecast, worldsteel expects steel use growth rates to rise to 3.2% this year. While the expected pick up in overall demand is good for steel manufacturers, it raises the prospect of a return to upward pricing pressure on the construction industry around the world including Canada. (Source - www.steelguru.com)
Automakers spend USD 3 billion boom for made in Mexico - April 18
It is reported that Mexico’s auto production has almost doubled since 2009. Now its steel industry is trying to catch up by spending almost USD 3 billion on new and improved factories.
Mr Marco Oviedo chief economist of Barclays Plc in Mexico in a telephone interview from Mexico City said that “Auto exports are going to be the new oil for the Mexican economy.”
Steelmaker Altos Hornos de Mexico SA, known as Ahmsa, has almost completed a USD 2.3 billion expansion designed partly to supply automakers. Ternium SA and Nippon Steel & Sumitomo Metal Corporation (5401) are teaming up on a USD 330 million investment to finish rust resistant steel, and South Korea’s POSCO is spending USD 300 million to more than double capacity for similar products.
The Mexican Automobile Industry Association predicts output will climb almost 40% to 4 million vehicles in 2017 as Nissan Motor Company (7201), Honda Motor Company (7267), Mazda Motor Corporation (7261) and Volkswagen AG (VOW)’s Audi unit build factories that join long standing plants for US carmakers General Motors Company and Ford Motor Company.
Mexico has become a magnet for automakers seeking low labor cost output with access to North and South American markets and other regions through the nation’s trade agreements with more than 40 countries.
In some cases, Japanese automakers were taking advantage of the yen’s strength against the dollar at the time they announced their investments.
Mr Paul Robinson senior economist at researcher IHS in a telephone interview from Washington said that “The automotive sector in Mexico is one of the stronger ones around the world. Because the expansion on the automotive side has come so fast and so recently, the steel industry is a little behind.”
(Source - www.steelguru.com)
SSI plans to expand safeguard future in Redcar - April 17
The Northern Echo reported that North-East steelworks has revealed multi million pound expansion plans to safeguard its long term profitability. A year after the first slabs of steel rolled off the 2 production lines at SSI UK in Redcar, the Thai owned firm is already planning to invest GBP 45 million in a third line to ease potential bottlenecks.
Steel bosses are also in talks to increase capacity at Teesport which could see massive loads of more than 100,000 tonnes leaving the region dwarfing the record 88,000 shipment which departed last May. It comes as the plant, which has suffered major cashflow problems during its first year of operation, prepares to start up a GBP 38 million coal injection plant regarded as key to the loss-making operation edging into profit.
The new facility will cut costs and boost the amount of iron produced in the blast furnace from 8,500 tonnes of iron a day to 10,000 tonnes. It will also see the plant source all of its coal from a local supplier, Hargreaves Services based in Esh Winning, County Durham, instead of importing materials from Russia
Crucially, the introduction of PCI on May 28th will ease pressure on SSI's Bangkok based parent company, led by Mr Win Viriyaprapaikit CEO and president of SSI, which has been bailing out the Redcar operation
Mr Phil Dryden CEO of SSI UK said that "It's been a hell of a difficult year but this has gone too far for Win to throw in the towel. We are only 6 weeks away from everything we have been striving for. Why would you kill something off just as its about to come good? The Thai owners have been brilliant so far. The challenge for us is to repay their faith."
Mr Dryden said that "Without PCI we have been limping along in terms of making the financials stack up. But after May we can really take things to the next level and by July I expect us to show a profit. The impact will be that quick."
While PCI is the immediate objective Mr Dryden is also looking towards future phases to cement SSI's position in the hugely competitive global steel market. 3 bidders are vying for the contract to supply a third steel caster which processes molten steel into slabs.
He said that "We'll have the blast going at such a rate it begs the question can the casting side of things keep up? The risk is that if we continue with two casters there is potential for bottlenecks."
Meanwhile, the preferred bidder should be selected this summer and the new caster installed by the end of next year.
(Source - www.steelguru.com)
Indonesia tin exports advance to highest since Oct - April 11
It is reported that refined tin shipments from Indonesia climbed to 5 month high in March as Malaysia and Singapore increased purchases from the world’s largest exporter.
Data from the Trade Ministry showed that exports including tin ingots and solder jumped 11.3% to 9,295.7 tonnes last month from February. That’s the largest shipment since October when sales reached 11,048.4 tonnes and is 8% higher than a year earlier.
Rising supplies may weigh on the price of the metal used in soldering and packaging which has fallen for two straight months in London. The metal, which climbed 22% last year, traded 0.3% higher at USD 22,999 per tonne on the London Metal Exchange.
Indonesia shipped tin to 11 countries last month. Shipments to Singapore, the biggest buyer rose 14.5% to 6,539.2 tonnes and sales to Malaysia gained 9% to 1,059.5 tonnes. Other destinations include Thailand and China. Exports in the Q1 jumped 20% to 26,805 tonnes from year earlier.
(Source - www.steelguru.com)
Arkansas House approves steel mill project - April 9
It is reported that Arkansas House lawmakers on Monday overwhelmingly approved Gov Mike Beebe's proposal to provide USD 125 million in state financing for the construction of a new steel mill in the northeast corner of the state.
Lawmakers voted 78-17 for a bill authorizing Arkansas to issue bonds to provide a loan and pay some construction costs of a USD 1.1 billion steel facility in Osceola.
The Senate has already approved identical legislation to authorize Big River Steel's project and its funding.
A supermajority of 75 House lawmakers will still have to sign off on a budget bill before the proposal is finalized. House Speaker Davy Carter has said he expects that vote will happen later this week.”
Big River Steel has promised to create at least 525 permanent jobs with an average wage of USD 75,000 in exchange for USD 125 million in state financing and other tax breaks. If the project is approved, the company has said it expects to close the deal in the third quarter of this year.
Proponents of the plan said the steel mill will be a boon for a depressed area of the state and Arkansas' economy in general.
(Source - www.steelguru.com)
European Parliament considers changes to ship recycling - April 8
reported that The European Parliament’s Environment Committee has introduced revised regulations designed to encourage obsolete vessels to be recycled in European Union approved facilities throughout the world. Members of the European Parliament also proposed that the scheme be funded by a recycling levy that would make scrapping ships in EU approved facilities cost-competitive.
Owners of EU ships would face penalties if they sold them to be scrapped in a developing country.
Mr Carl Schlyter, who is steering the legislation within Parliament, said that “Today’s vote will hopefully put an end to EU ships being recklessly scrapped in developing countries. Currently, most EU ships are sent to Southeast Asia at the end of their lives, where they are beached and their hazardous materials harm human health and the environment.”
Mr Schlyter said that “MEPs have voted by a very large majority to create financial incentives to scrap ships safely, including a recycling fund financed by the industry itself. This would steer ships that trade with the EU into proper ship recycling facilities. We hope that this will now be included in the final legislation.”
However, the law would apply to EU ships. Several of the provisions, including the recycling levy, would also apply to any ship calling at a port or anchorage of an EU member state.
Member states would be required to ensure that an inventory of hazardous materials is established on board each EU ship. Non EU ships entering a port or an anchorage of a member state would also have to have a hazardous materials inventory on board. If an inspection showed that the condition of ship does not comply with the inventory, penalties could be imposed.
The committee said that to help make the scheme economically viable, a recycling fund should be set up. Both EU and non-EU ships would be able to use the fund, which would be financed, in line with a polluter pays principle, by a recycling levy to be charged for any port call by EU or non EU ships. Ship owners could choose between an annual recycling levy, directly payable to the fund, and a fee per port call, which would be collected by port authorities.
According to the European Parliament, ships would be exempted from paying the recycling levy if their owners deposited a financial guarantee to ensure that they use EU listed facilities for recycling and treatment. Charging the levy on port calls would make it impossible to evade by re-registering a ship outside the EU.
(Source - www.steelguru.com)
|
