STEEL WEEK IN BRIEF: Scrap, iron ore prices down, Chinese HRC export prices fall, steel mills announce investments...
Metal Bulletin reviews the major stories affecting the steel market over the past week.
The trading of iron ore in the physical market largely came to a close on Friday September 29 with most participants in China starting a week-long break to mark the National Day holiday.
Metal Bulletin’s 62% Fe Iron Ore Index was $62.05 per tonne cfr Qingdao on Friday, down by $0.84 per tonne on a daily basis.
The seaborne coking coal market was also quiet, as expected, on Friday ahead of the holiday, although the outlook remains weak amid concerns over Chinese demand.
Metal Bulletin’s cfr China Premium Hard Coking Coal Index fell $1.91 per tonne to $192.50 per tonne while the fob Australia index dropped $1.13 per tonne to $191.43 per tonne.
Turkish import scrap prices continued to drop during the week, with mills buying cargoes at lower prices from both North America and Europe.
The import markets in Taiwan and India have dropped in line with Turkey’s, along with US export and Turkish domestic scrap prices.
And steelmakers across the USA are wasting no time in cancelling unshipped orders for ferrous scrap as sellers brace themselves for a very large price correction in October.
In the pig iron sector, export prices have fallen both in Brazil and the CIS region on falling commodities markets.
China’s export prices for hot rolled coil (HRC) have fallen for the first time in about four months, with less activity in the country’s domestic market for the steel product.
China’s rebar prices moved further down on Friday on heightened selling interest ahead of a week-long holiday in the country.
Slab import prices in Asia are expected to fall in the coming weeks, following a price drop in China and weakness in raw materials markets.
Southeast Asia billet import prices, meanwhile, have already fallen, following the sharp decline in Chinese billet values and the weakness in raw materials.
Saudi Arabia’s biggest steel producer, Hadeed Sabic, has increased its domestic rebar price to 2,200 riyals ($586) per tonne ex-works.
Flat steel prices in Turkey’s domestic market fell over the past week, and market participants expect to see further falls for December production.
In contrast, strong price growth in Italian HRC this month has almost removed the domestic price premium traditionally enjoyed by HRC produced in Northern Europe compared with Southern European mills.
Offer prices for steel beams in Europe have increased from certain stockholders and mills over the past week despite the decline in ferrous scrap costs.
Outokumpu has introduced an extra charge, related to graphite electrode costs, for all stainless steel products, with immediate effect.
And Gerdau Long Steel North America increased its rebar prices by $20 per ton on all new orders from September 26.
The European Commission (EC) has proposed applying a fixed price per tonne instead of a minimum import price for HRC brought into the region from Russia, Ukraine, Brazil and Iran.
Brazil has extended the deadline in an anti-subsidy investigation into imports of HRC from China.
And Egypt has extended the anti-dumping duties on rebar from China, Turkey and Ukraine for another two months.
Around the world
Several companies announced new investments this week.
Ternium plans to build a 3.70 million-tpy hot rolling mill at its Pesquería industrial centre in Mexico’s Nuevo León state, as well as a 520,000-tpy rebar manufacturing unit in northern Colombia.
ArcelorMittal will invest $1 billion in a three-year investment plan at its Mexican operations.
Salzgitter is planning to build a third line for production of hot dipped galvanized material at its flat steel production unit Salzgitter Flachstahl in Germany.
US Steel and Kobe Steel are planning to add an ultra-high-strength, continuous hot dipped galvanizing line with 500,000 tpy capacity at their Pro-Tec Coating joint venture in Ohio, USA.
Austrian steelmaker Voestalpine has increased its wire rod production capacity by 50% with the opening of a new plant in Donawitz.
Meanwhile, US Steel has received multiple expressions of interests in its integrated steel mill and coke batteries in Slovakia.
Ball Corp has confirmed that it will discontinue steel food can production at its Springdale facility in the US state of Arkansas during the fourth quarter of this year, citing a decline in food can demand.
Brazilian steel institute Aço Brasil has held a series of meetings with officials in the USA to demand that the Latin American country be excluded from any measures arising from the USA’s Section 232 investigation into steel imports.
And Metal Bulletin reported extensively from the 77th Irepas (International Rebar Exporters & Producers Assn) meeting in Athens, Greece.
The loss of demand for rebar imports in Algeria could lead to a reduction in Italian production capacity, according to Wilhelm Alff, long products sales manager at steel trader Duferco.
European costs for rebar and billet produced through the electric arc furnace (EAF) route have risen by about €40 ($47) per tonne, according to Celsa Steel commercial director José Angel Rey.
And higher-grade ferrous scrap prices are likely to diverge from other grades in the coming months as electric arc furnace-based (EAF) steelmakers look to conserve graphite electrodes, Sundeep Rao, director at Oman’s Sharq Sohar Steel Group said at the event.