HIGHLIGHTS: Sub-$57 iron ore, China steel under pressure, trade case updates
Editor Vera Blei looks at the main news covered by Steel First this week.
Paragraph entered by Atlantic migration, in order for SteelFirst articles to display correctly on Metal Bulletin.
Iron ore spot prices dropped below the $58-mark this week.
The daily Metal Bulletin index for 62% Fe material closed at $57.66 per tonne on Friday March 13, down $1.83 per tonne week-on-week.
Swiss investment bank UBS has lowered its iron ore price forecast for both 2015 and 2016 to under $60 per tonne cfr.
The Singapore Exchange (SGX) has seen an active launch day on Monday March 9 for the latest addition to its iron ore derivatives portfolio.
At least five trades have gone through on the first day of the SGX’s listing of lower-grade iron ore derivatives contracts, with activity concentrated on the contract settling against Metal Bulletin’s 58% Fe Premium Index, brokers told Steel First.
Iron ore inventory levels at Chinese ports rose to a seven-week high this week as prices fell to record lows.
China’s steel exporters are feeling a chill in the market despite the approach of spring warmth, as the unclear pricing outlook kept buyers on the sidelines.
Mills and traders surveyed by Steel First have generally reported thin business since they resumed work after the Chinese New Year holiday due to weak buying interest from the offshore market.
Hebei province’s battle against overcapacity has attracted the attention of China’s national leadership, with premier Li Keqiang urging support to be given to it.
China removed its export tax rebate for boron-added mesh-quality steel wire rod on January 1, but domestic steelmakers continue to produce the material and export deals continue to be agreed.
In our weekly Steel First Outlook column, our colleagues at Metal Bulletin Research (MBR) took a look at the impact of the iron ore surplus and weak demand for steel on the coking coal market.
Ilva, Ukraine, Turkey exports, freight
Elsewhere, flat steel product prices in Europe could be raised by as much as $30 per tonne because of restructuring and cuts in production at Italian steelmaker Ilva.
It is crucial for Ukrainian steel exporters to retain market share “even with zero profitability”, Vladimir Vlasyuk, head of state-run consultancy Ukrainian Industry Expertise (UEX), told Steel First in an interview.
The Turkish Steel Exporters Assn (CIB) has added a new facet to its support programme that aims to help domestic steel companies to increase their export volumes.
A needs analysis was performed with global financial adviser EY for 62 steel companies participating in the International Competition Development Project (URGE) programme, to investigate ways to increase their exports and to understand the structural deficiencies that prevent them doing so.
Meanwhile, freight costs for steel products have remained largely unchanged on Asia’s regional trade routes despite low bulk carrier rates globally and recent bankruptcy cases in the shipping sector.
Trade cases & standards
In Mexico, members of the country’s steel association, Canacero, have asked the national economy secretariat to start an anti-dumping probe into imports of stainless steel pipe.
Mexico’s economic competition commission, Cofece, has rejected a proposal for new steel quality standards presented by the national economy secretariat.
The Turkish Steel Exporters Assn (CIB) has backed calls for a public inquiry in Canada into newly imposed anti-dumping duties on the North American country’s imports of rebar.
The World Trade Organization (WTO) dispute settlement body has set up a panel to review Canadian trade duties against steel welded pipe from Taiwan.
The US Commerce Department should be allowed greater leeway within US anti-dumping and countervailing trade cases to apply diverse remedies when foreign exporters do not cooperate with an investigation, according to Nucor.
New scrap assessments
And finally, Steel First has added two German domestic scrap assessments for E8 and E40 material to its pricing database.