Author Archives: Taras Berezowsky

Here’s What Happened

    • MetalMiner’s Global Precious MMI took a bit of a dip this month, coming down 1.1% to 83.
    • The sub-index’s value held at 84 in June and May, but on balance, the price drops within the overall basket of metals couldn’t hold the ship steady into this post-Independence Day summer lull.
    • While our U.S. platinum bar price got very close to its 2017 start-of-the-month low (which it hit in January; more on platinum below), U.S. palladium rose 3.8% month-on-month to record its highest price in 34 months — nearly a 3-year high.

Benchmark Your Current Metal Price by Grade, Shape and Alloy: See How it Stacks Up

What’s Going On in the Background?

  • Diesel goin’ down? Due to negative sentiment after Dieselgate, as MetalMiner’s Editor at Large Stuart Burns pointed out recently, sales of diesel vehicles in some parts of Europe have taken a dive in the past few months over concerns that “authorities will raise costs or otherwise make living with diesel engines a less attractive proposition for owners.” Overall, total car sales have dropped in some European markets, including the U.K. — but in the spots where they haven’t, gas-powered vehicles have been winning over diesel. In short, not awesome for platinum prices.
  • BEVs are not the panacea. Battery electric vehicles (BEVs) could be the ticket … except that the World Platinum Investment Council forecasts BEVs to make up no more than 5% of the market by 2025, so that wouldn’t work either.
  • Of course, investor demand, jewelry demand and other industrial sectors, such as chemical, all play into it. But “platinum’s fortunes will in part ride on the coattails of the auto industry’s ability to re-establish the diesel engine as an environmentally acceptable propulsion unit,” according to Burns.
  • Meanwhile, as my colleague Fouad Egbaria reported yesterday, gold is now trading on the LME.

What Metal Buyers Should Look Out For

  • The divergence between platinum and palladium prices of late certainly merits attention, and perhaps may drive industrial manufacturers to broader substitution efforts — but that could be a stretch. According to analysts cited by the Financial Times (paywall), “the divergence reflects a number of factors, including speculative demand and several years of production deficits that have eroded stockpiles and reduced available supplies.” The article goes on to say that longer term, “with the increasing popularity of electric vehicles, analysts say this year’s turbocharged run for palladium could be a last hurrah for the material, which has few industrial uses outside of the car industry.”
  • Last month, we wrote that “while we’re unsure of when prices will swing back up, mainly because output cuts in South Africa and elsewhere have seemingly not helped, it may be hard to discount current windows for smaller spot buys.” Fortunately for platinum spot-buyers, this still holds true.

Key Price Movers and Shakers

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Join MetalMiner‘s Lisa Reisman, Ecovadis‘ Daniel Perry and Jaggaer‘s Roger Blumberg as they share how to bolster your organization in these times of uncertainty in the following ways:

  • Quickly drawing up a model of a company’s parts and bill of materials to identify areas in need of support and glean insight into the negotiation process
  • Managing the lifecycle relationship of parts, products, and suppliers
  • Reducing risk and improve agility in the MRO supply chain while more reining in small dollar spend

And much more — Join us on June 27th at 12pm EDT/9am PDT for the FREE WEBINAR:

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MetalMiner just reported that the Trump administration, in its efforts to curb imports it maintains are harmful to U.S. industry, may just have injected more volatility into the landscape for domestic manufacturers.

The European Union is worried about a “trade policy readjustment” from President Trump’s team, which could evidently include tariffs placed on the bloc’s metals and materials imported into the U.S.

The Section 232 investigation has mainly put China and its imports into the crosshairs, but now the EU is concerned that these new tariffs would “unjustifiably hit” EU nations, according to Cecilia Malmström, the EU trade commissioner.

What does this mean for U.S. manufacturers — and will events such as this affect how you should be managing your organization’s (and your suppliers’) commodity risk?

Find Out in a Free Webinar Tomorrow

Join MetalMiner‘s Lisa Reisman, Ecovadis‘ Daniel Perry and Jaggaer‘s Roger Blumberg as they share how to bolster your organization in these times of uncertainty in the following ways:

  • Quickly drawing up a model of a company’s parts and bill of materials to identify areas in need of support and glean insight into the negotiation process
  • Managing the lifecycle relationship of parts, products, and suppliers
  • Reducing risk and improve agility in the MRO supply chain while more reining in small dollar spend

And much more — Join us on June 27th at 12pm EDT/9am PDT for the FREE WEBINAR:

 

2017 has seen no shortage of uncertainty when it comes to manufacturing policy.

For example, with the Section 232 investigation is in full swing, other issues remain on deck. From the Dodd-Frank conflict minerals rule getting repealed, to potential changes in visa requirements, the landscape is littered with unpredictable twists and turns.

That’s why getting smart on the following is crucial for your manufacturing organization — not just today, but well into the future:

  • Optimizing supplier management to accommodate new suppliers and streamline complex qualification processes such as PPAP, product testing, and more
  • Quickly drawing up a model of a company’s parts and bill of materials to identify areas in need of support and glean insight into the negotiation process
  • Managing the lifecycle relationship of parts, products, and suppliers
  • Leveraging best-in-class minerals traceability processes and programs to further enhance CSR initiatives
  • Reducing risk and improve agility in the MRO supply chain while more reining in small dollar spend

MetalMiner‘s Lisa Reisman, Ecovadis‘ Daniel Perry and Jaggaer‘s Roger Blumberg are set to share the tools for all of the above, to bolster your organization in these times of uncertainty.

Join us on June 27th at 12pm EDT/9am PDT for the FREE WEBINAR:

 

Here’s What Happened

  • All quiet on the precious-metals front this month, as our Global Precious Metals MMI held pat from May to June at a reading of 84.
  • Since we tend to keep a closer eye on the platinum group metals (PGMs) due to their automotive applications, the U.S. platinum price tracked by the MetalMiner IndX posted only a negligible gain, while the U.S. palladium price suffered only a negligible loss…reflected directly in the wash that was the sub-index’s June performance.
  • Interestingly, gold has been getting hot as of late. More on that below.

What’s Going On in the Background?

  • Although the Global Precious Metals MMI did not reflect it in the May-to-June time period, the U.S. gold price increase after June 1 has gotten some heads turning. As my colleague and new MetalMiner Editor Fouad Egbaria reported earlier this week, “gold neared its year-to-date high on Tuesday,” according to Reuters. “The rise comes in a climate of political uncertainty, with an election in the United Kingdom, former FBI Director James Comey’s testimony before the Senate Intelligence Committee on Thursday and a European Central Bank meeting this week,” Egbaria noted.
  • Back to platinum. As a reflection of the metal’s dawdling short-term pricing, South African producer Lonmin has been struggling, so much so that Reuters reported earlier this week that the company is “pulling every lever to try to restore confidence in its ailing business, including reopening a major shaft and expanding its biggest operation,” according to Lonmin’s CEO. Low prices and skyrocketing costs have reportedly conspired to present the company with a cash problem over the past near-decade.

What Metal Buyers Should Look Out For

  • Platinum specifically has had a low-price problem this year — but that’s obviously less of a problem if you’re purchasing metal. While we’re unsure of when prices will swing back up, mainly because output cuts in South Africa and elsewhere have seemingly not helped, it may be hard to discount current windows for smaller spot buys.

Exact Prices of the Key Movers and Shakers

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Here’s What Happened

  • Our Rare Earths MMI, tracking 14 rare earth metal and mineral prices, ticked up to 21 for the June 1 reading, a whopping 10.5% increase from May.
  • We write “whopping” mainly because the Rare Earths MMI has held below the value threshold of 20 since August 2015 — a full 22 months ago. As we wrote last month, that’s when the stock market had its worst month in 5 years.
  • Rare earths prices on the whole, however, seem to be recovering from their 2016 lows. Terbium oxide, for example, rose 11.8% from May to June. Europium oxide, for its part, spiked up 16.7% in the same period.
  • Meanwhile, the dysprosium oxide price has fallen off slightly month-on-month.

What’s Going On in the Background?

  • “The REE mining process is intensive and requires highly toxic processing, which reduces competitiveness,” according to this article. “Because of lighter restrictions on mining and—especially—processing, China remains the world’s top supplier of rare earths.” But a considerable knock-on effect on rare earths prices could be the environmental pollution curbs that China has been (at least publicly) committing itself to as a developing economy. The environmental pressure has likely filtered down to the rare earths processing industry, constricting output enough to squeeze prices upward.
  • Outside China, these exact environmental worries have hamstrung any viable production models (or at the very least, profitable ones) — and Exhibit A is the Molycorp/Mountain Pass debacle. The Mountain Pass mine in California, which used to the the Western Hemisphere’s best bet to unburden its markets from reliance on Chinese REEs, is now being buffeted about by investors battling for the scraps.

What Metal Buyers Should Look Out For

  • While we’re by no means at a market top for the rare earths sector, keep a close eye on “hot” REEs such as dysprosium, as we mentioned last month. New ventures that are getting folks’ attention, such as this one in Australia, are creating a lot of bullish narratives. As we mentioned before, however, in the short term, dysprosium does not look as strong as some of the other constituent metals and minerals, dropping in price between May 1 to June 1.

Key Price Movers and Shakers

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Welcoming Fouad Egbaria as MetalMiner’s next editor.

With MetalMiner Founder (and Founding Editor) Lisa Reisman taking a chance on bringing in who she thought was a “Tara” to interview for a position back in October 2010, she laid the groundwork for running a Medill shop, as they say.

As a grad student at Northwestern’s Medill School of Journalism — or whatever newfangled, marketing-driven title they’re now featuring — I had often heard of leading media organizations running Medill shops, in which a number of Medill alums make up the ranks of the respective companies’ employment force. Often, the orgs spoken of were sexy media giants, the Bloombergs of the world, unlike the group of scrappy niche industry blogs with something very unique to offer that I was about to join.

We’ve ultimately brought on four more Medillians (as they’re called, for better or worse) into our fold over the time I’ve been with the company. Sydney Lazarus and Nick Heinzmann, the formidably talented editors of our sister site Spend Matters, both spent time on the grassy knolls of Northwestern’s Evanston campus studying journalism.

But MetalMiner’s editorial team in my time has only ever consisted of Medill grads. After me, the inimitable Jeff Yoders became MetalMiner’s daily editor, whose exploits you can get a better sense of in this post. But if you stick around our search bar long enough (we don’t have infinite scroll — yet), you’ll find MetalMiner’s archives literally overflowing with Jeff’s stalwart contributions to the publication over the several years he spent with us.

Now, with all this before him to live up to, Fouad Egbaria takes over as editor of MetalMiner this week. Though his headshot above may be small, his achievements are not; and his vision (although nascent) of what he plans for MetalMiner, and thoughts on where journalism is going, peek through in our recent chat with him.

Cue the Wikipedia Entry-Style Highlights

Fouad comes to MetalMiner from 22nd Century Media, where he covered virtually everything — from municipal meetings to crime to theater — for a group of weekly hyperlocal newspapers based in the north suburbs of Chicago. He nabbed a National Newspaper Association honorable mention award for Best Sports Story last year.

He grew up in Gurnee, Ill., spending “many summer days at Six Flags or Gurnee Mills”…as one does up there. He established a firm bond with University of Michigan athletics (a man after my own heart), especially football, when he was a youngster living in Ann Arbor while his father taught at the school. Fouad was actually born in Israel, but moved to the U.S. with his parents when he was two months old. He went to high school in Alabama, then back to study with The Leaders and Best for a degree in English, and then on to Northwestern’s Medill. (Even though Fouad is a U-M grad, he has not yet flaunted it — no #Hail hashtags in his social feeds or anything annoying like that, thank goodness.) From what I’ve gotten to know of him so far, he is a sharp, calm, even-keeled presence who will be a fitting addition to our newsroom.

Here are a few other nuggets from our email conversation.

What would you consider your best (perhaps most unconventional) skill?

I’m not sure if it’s my best or most unconventional skill, but I have the ability (curse?) to notice typos/mistakes in just about anything, including that sign in some grocery store express checkout lines (it’s “15 items or fewer”) or on restaurant menus.

When you’re not working, what would you most rather be doing?

I love to read (fiction, non-fiction, print newspapers, news apps on my phone, magazines), I run, I write about Michigan sports and work on fiction writing ideas (whenever I have time). When the weather’s nice, I like to go fishing, hiking and kayaking. Just so I’m not sounding disingenuous with respect to how active my lifestyle actually is, I also binge-watch TV shows, most recently the newest season of “Master of None.”

Which professional sport do you track/cover most closely, and why?

College football (I know it’s not a professional sport, but given the amount of money it generates, it might as well be). I contributed to the Michigan website on SBNation.com for several years, and have my own Michigan sports blog (which unfortunately hasn’t been updated since the end of the NCAA Tournament).

Where do you see journalism going in the next decade?

As long as advertising continues to decline and many readers refuse to pay for journalism, newsroom cuts will continue and already fairly skeletal news operations will become unaffordable and fold. Unfortunately, our national discourse is plagued by a lack of nuance, particularly when discussing “the media,” a term thrown around as if the media is a monolithic entity (it isn’t). Are there journalists — writers, editors and so on — who do bad work (with malicious intent or not) or make mistakes? Sure. But there are also so many talented journalists doing great, inventive work all the time across a wide variety of platforms, from the humble beat reporters all the way up to the high-profile names in news. With the digital tools now available, journalism has never been as fast, engaging and powerful as it is today, and I think that will only increase in the next decade.

Media mergers will continue, big media conglomerates will continue to eat up individual papers and more print publications will likely go under — none of these things are good, in my opinion. But as long as there is news — and there will always be news — there is a valuable place in society for journalism.

What are you most interested in learning while helming the digital pages of MetalMiner?

I’m excited to learn more about metal markets and how geopolitics, the ebb and flow of supply and demand, and the people and companies who make transactions in these markets all intersect. There’s a lot happening all over the world, politically and economically, so there’s almost always something new in these markets, sometimes by the hour or even by the minute.

*

I know what some of you may be thinking: is running a Medill shop — whether consciously or, in our case, not— too incestuous? We tend to think not, trusting that the quality of the work will bear out the collective decision to run one. But if the President of the United States gets to have his daughter and son-in-law working closely with him in the White House, well, why not?

Go ‘Cats, and welcome, Fouad!

On this Memorial Day 2017, we at MetalMiner would like to take the opportunity to look back at what matters, starting with the reason for the holiday itself.

We salute the brave men and women across all armed forces for their service and sacrifice, which is more important today than ever. In the wake of the Manchester bombing, it’s only right to take a moment and honor those who risk all to fight for freedom from fear.

14ktgold/Adobe Stock

Memorial Day Roundup – The Year That’s Been So Far

What else matters on this Memorial Day?

The first five months of 2017 have been interesting ones, in which we’ve seen these three MetalMiner stories perform the best — spoiler alert, aluminum is the frontrunner for Metal of the Year so far:

We Launched MetalMiner Benchmark

Here’s the deal, folks.

Gamechanger, amirite?

ISM 2017 Happened

A contingent of our company, representing our sister site Spend Matters, descended upon the annual Institute for Supply Management (ISM) conference in Orlando, Fla., the premier event for purchasing/procurement and supply chain professionals.

Here’s a highlight, from our colleague-in-attendance Pierre Mitchell:

A “great session was the Q&A with ISM CEO Tom Derry, Hans Melotte (ex-Johnson & Johnson CPO who is now CPO at Starbucks) and Kris Pinnow (CPO at B/E Aerospace). I asked Tom about the ISM economic forecast showing slightly higher U.S. growth rates in manufacturing compared to non-manufacturing, and he said that it’s likely a combination of nearshoring, automation, foreign investment in the U.S. and manufacturing for exports. Here, Tom aptly said that ‘a company’s supply chain follows demand – and that’s [U.S. government] administration agnostic.'”

For more on the conference highlights, head over to Spend Matters.

We Bid Adieu to Jeffrey Yoders

jeff yoders chicago cubs 1060 project

Read more

Photographee.eu/Adobe Stock

What happens when an illegal business practice becomes so common and virtually accepted that it ultimately gets difficult to break?

Many U.S. manufacturers would argue that we’re in a period of global trade that features one such practice: trade circumvention. The most slippery aspect of ferreting out circumvention is first defining which segment of industry gets harmed the most, before even knowing what to do about it. Is it the upstream sector, including primary steel, textiles or plastics production? Or the downstream sector, such as the residential washing machine business?

MetalMiner Executive Editor Lisa Reisman makes the case that the lines between upstream and downstream manufacturing have blurred in this new report, Rules-Based Trade Remains Critical to Manufacturing Health.

But first we must understand the basics. Here’s an excerpt from that paper defining the landscape of trade circumvention in a short primer.

What is Trade Circumvention?

According to the Organization for Economic Cooperation and Development, circumvention refers to “getting around commitments in the WTO such as commitments to limit agricultural export subsidies. It includes: avoiding quotas and other restrictions by altering the country of origin of a product; measures taken by exporters to evade anti-dumping or countervailing duties.”

Four steel producers filed a petition last September, charging China with circumventing anti-dumping and countervailing duty orders for corrosion-resistant carbon steel and cold-rolled carbon steel by sending substrate materials to Vietnam for processing and re-export. The claim appears to be supported by trade data (as shown by an spike in Vietnamese cold-rolled and CORE imports after November 2015 while the same Chinese imports drastically decreased after duties were imposed on the latter, for example). Read more

Looks like the tide has finally turned.

Benchmark Your Current Metal Price by Grade, Shape and Alloy: See How it Stacks Up

Extending that metaphor is easier now than it’s ever been for us writing on this topic: the reshoring of American manufacturing from abroad — and specifically, the net gains in jobs that we’ve been seeing in 2016 and early 2017 as compared with the trends in the early 2000s.

(I envision the emigrating jobs huddled together for warmth on a seaworthy vessel, with Shanghai getting smaller in the distance as the Pacific waves toss the boat ever closer toward Long Beach… if only it were that poetic.)

Back to reality. The Reshoring Initiative has just released its 2016 Data Report, and the numbers seem to tell a rosy story. According to the report press release, “in comparison to 2000-2003, when the United States lost, net, about 220,000 manufacturing jobs per year to offshoring, 2016 achieved a net gain of 27,000.”

“The numbers demonstrate that reshoring and FDI are important contributing factors to the country’s rebounding manufacturing sector,” the release concluded.

But of course, it’s not that easy. Major policy changes will have to be made or improved to continue the reshoring trend (which is still in its early stages), according to Harry Moser, founder of the Reshoring Initiative.

In a way, the U.S. should aspire to host conditions like those in Germany, Moser told me, including a supportive government, VAT, low healthcare costs, and an appreciation of the benefit of local sourcing. Read more