In the countervailing duties investigation, Commerce found that mandatory respondent Steamline Industries Limited received countervailable subsidies at a rate of 3.13% and that mandatory respondent Sunrise Stainless Private Limited, Sun Mark Stainless Pvt. Ltd., and Shah Foils Ltd. (collectively, “Sunrise Group”) received countervailable subsidies at a rate of 6.22%. Commerce assigned a final subsidy rate of 4.65% for all other producers/exporters in India.
As a result of the affirmative final determinations, Commerce will instruct U.S. Customs and Border Protection to collect cash deposits equal to the applicable weighted-average dumping and subsidy margins.
Welcome back to the MetalMiner week-in-review! This week we’ve got in-depth reporting on China and market economy status, India getting tough on aluminum imports and Canada… well, you’ll see what happened in Canada.
We Know Gold Prices Have Gone Up… Butt This is Ridiculous
The theft of about $140,000 worth of gold ($180,000 in Canadian dollars) from the Royal Canadian Mint, was supposedly an inside job… in more ways than one.
After a trial that concluded in Ottawa on Tuesday, Leston Lawrence, a 35-year-old employee of the government mint in Ottawa, stood accused of foiling the facility’s high security and smuggling out 18 7.4-ounce pucks — this is Canada, after all — worth about $6,800 each. He sold most of the pucks, cooled into the size of a purity testing dipper used at the mint, to an Ottawa Gold Sellers retail store at a nearby mall. The accused criminal mastermind also had four more of the pucks in a safe deposit box.
“Go ahead, scan me with the wand. Nothing to see here.” Source: Adobe Stock/John Takai.
The question the Royal Canadian Mounted Police, or the Mint, couldn’t figure out is how he got past the state-of-the-art security that featured full-body metal detectors and secondary screenings with a wand for anyone that tripped the first scan?
Before Lawrence was fired from the Mint and arrested in 2015, investigators also found a tub of Vaseline in his locker. While the wand scanners can pick up even small pieces of metal in a person’s clothes, security officials from the Mint said they probably would not detect dipper-sized gold pucks that were forced between someone’s buttocks using the vaseline.
Oil prices fell as Saudi Arabia poured cold water on a potential deal with other Organization of Petroleum Exporting Countries members and other countries such as Russia. China is threatening to place tariffs on sugar imports.
Crude Oil Selloff
Crude prices are selling off today, aided by Saudi comments that a decision will not be forthcoming from next week’s Organization of Petroleum Exporting Countries meeting in Algiers.
Many had thought that OPEC was close to reaching a deal to curtail production for up to a year with its members and non-member producers such as Russia, but the Saudi announcement makes it highly unlikely that any deal will happen soon now.
Saudi Arabia has made production by regional rival Iran an issue in any deal to constrain production. The Saudis say Iran must abide by any deal just like other member-states and Iran and its allies say Iran should be allowed to bring its capacity up to full production, as it just re-entered markets after decades of sanctions, before it starts to cut.
China Explores Sugar Tariffs
China has launched a probe into soaring sugar imports following complaints by its domestic industry, the government said on Thursday, the latest sign that trade tensions between major commodities producing nations is intensifying.
The Ministry of Commerce said the probe will look at imports since 2011 and into possible protectionist measures provided by foreign countries for their producers. It will last six months, with an option to extend the deadline, it said.
Whether you’re a regular MetalMiner reader, or have never heard of us before, you’re likely familiar with the outsize role China has played in trading with the Western world — and especially with the United States.
That’s why we’ve taken the opportunity to dive deep on a nuanced issue that’s central to the U.S.-China relationship, now and into the future. Our new project, China vs. the World: Why the Battle for New Trade Status is Such a Huge Deal, explores how China’s approach to global trade over the past several decades has affected American commerce (for better and worse), and how something called “market economy status” could change the rules of the game as we know it.
In the latest move, U.S. Representatives Tim Murphy (R-PA) and Peter J. Visclosky (D-IN), the chairman and vice-chairman of the Congressional Steel Caucus, respectively, introduced a House resolution calling on the current Administration to take action on this very issue. But resolving the issue will likely be a longer battle.
While the mainstream media has taken advantage of reporting presidential hopeful Donald Trump’s numerous references to China and his blunt stance on how he intends to change our relationship with that country, MetalMiner’s journalists and editors set out to unpack the tangible drivers behind these types of general sentiments, with a particular focus on — and for — U.S. manufacturing organizations.
Personal video perspectives from key players across several different industries illustrate the China effect on American jobs, workers and approaches to business.
We hope you’ll find this type of project and its presentation refreshing and informative. If you like it, please share it with your networks! We welcome and value your feedback, so please feel free to send us a note at email@example.com.
So, will aluminum receive a similar tariff shield as steel has enjoyed in India? The shield refers to a minimum import price (MIP) that is generally imposed on cheap commodities entering India, just like cheap steel from China.
In the case of aluminum, too, the main “culprit” seems to be China. Yet, the stance of the Indian government vis-à-vis an MIP is still not clear, as various ministries concerned with the development have given divergent opinions. Read more
There has been considerable concern in the U.S. and elsewhere that China’s exports of primary aluminum are damaging global prices. China would maintain that it imposes an export duty on primary aluminum explicitly to prevent the export of primary metal, largely seen as exporting energy due to the high power cost associated with producing each metric ton of the metal.
Many outside China believe a considerable amount of metal leaks out of the country in the nominal form of semi-finished products which avoid the export duty, and, indeed, attract a value-added tax refund, only to be subsequently remelted. Large volumes of exports from China make their way to Vietnam, and it is believed much of this material is remelted in the country before being sold.
The Impact of Chinese Aluminum
However, our concern in this article is not so much the impact of primary metal leakage, considerable as it may be, but rather the growing threat of Chinese value-add product manufacturers and the impact they are having on western firms that had previously had the field cornered for automotive and aerospace — to name but two high-tech applications for aluminum — applications.
Chinese material at the end of the last century was considered a joke in terms of quality, but over the first 10 years of this century the country has invested heavily in European and Japanese extrusion, rolling and heat treatment plants and equipment. By the beginning of this decade, Chinese extrusions and commercial sheet/plate were being given equivalence to material from many other sources such as Russia, Turkey, South Korea, Taiwan and other locales.
Are aluminum slabs welded together really “deep-processed extrusions?”
Such material is still sold at a discount to European or North American semi-finished products, but its growing penetration and the willingness of major distributors to hold a proportion of their inventory as Chinese material, speaks volumes for its growing acceptance, particularly in terms of quality.
The Lucrative Automotive Market
Still, while China — and to a lesser extent mills in places like Malaysia, Turkey and other locales — gradually ate into western mills’ commodity products, those same western mills moved upstream, investing heavily to meet growing demand for automotive sheet and castings, aerospace sheet, plate and extrusions. Read more
Without doubt, much of iron ore’s gains in 2016 have been driven by strong demand from China, with imports up 9.3% to 669.65 million metric tons in the first eight months of the year from a year ago. But prices in Qingdao lost 5.8% in the seven sessions through Wednesday. That was the longest run of daily declines since March and while steel output remains robust, questions are again being asked how much longer prices can remain north of $55 per mt as yet more supply comes on stream. According to the MetalMiner index, finished steel prices have eased this month.
Iron Ore Output
You would expect the miners to refute this and, sure enough, in a Bloomberg report,Vale SA and Cliffs Natural Resources Inc. said that the impact of the new output won’t be as severe as expected and will see the $50 per mt level holding, but banking analysts are not so sure with Westpac saying last month rising supply will drive prices below last year’s lowest point of $38.30, while Citigroup expects an average of $45/mt next year. Read more
For the purpose of an anti-dumping investigation, dumping occurs when a foreign company sells a product in the U.S. at less than its fair value.
n the Brazil investigation, Commerce preliminarily found that dumping has occurred by mandatory respondents, Companhia Siderurgica Nacional and Usinas Siderurgicas de Minas Gerais SA, at a preliminary dumping margin of 74.52%. The dumping margin for the mandatory respondents was based on adverse facts available (AFA) as a result of their failure to cooperate in the investigation. Commerce assigned a preliminary dumping margin of 74.52% for all other producers/exporters in Brazil. Read more
U.S. steel companies applauded as tariffs were upheld on hot-rolled steel flat products and the London Metal Exchange took a hit when it had to move its open-outcry trading to another location when its new office wasn’t ready this summer.
ITC Upholds Hot-Rolled Steel Tariffs
The U.S. International Trade Commission handed another victory to American steelmakers on Monday, affirming most of the recent anti-dumping and anti-subsidy duties on hot-rolled flat steel imports from Australia, Brazil, Britain, Japan, the Netherlands, South Korea and Turkey.
The commission rejected anti-subsidy duties of about 6% against hot-rolled steel from Turkey, but affirmed anti-dumping duties of about 6 to 7% against Turkish-made hot-rolled steel. The rest were all upheld.
LME Trading Move Hit Volumes Hard by Move
The temporary relocation of open outcry trading at the London Metal Exchange (LME) to a disaster recovery site due to problems at its new offices hit volumes hard during the already quiet summer months, brokering sources said.
For all contracts traded on the LME, volumes fell more than 9% year-on-year in August to 12.18 million lots, after a drop of nearly 18% in July. Volumes for aluminum and copper fell nearly 22% and seven percent respectively in August from the same period a year ago.
Commerce preliminarily found that dumping occurred by mandatory respondents, Shanxi Taigang Stainless Steel Co., Ltd. and Tianjin Taigang Daming Metal Product Co., Ltd. Commerce also determined that the mandatory respondents are not eligible for a separate rate, and therefore part of the China-wide entity.
Commerce calculated a preliminary dumping margin of 63.86% for the non-selected respondents eligible for a separate rate. Commerce preliminarily assigned a dumping margin of 76.64% based on adverse facts available for all other producers/exporters in China that are part of the China-wide entity due to their failure to respond to Commerce’s requests for information.
As a result of the preliminary affirmative determination, Commerce will instruct U.S. Customs and Border Protection to collect cash deposits based on these preliminary rates.
The petitioners for this investigation are AK Steel Corporation, Allegheny Ludlum, LLC d/b/a ATI Flat Rolled Products, North American Stainless, and Outokumpu Stainless USA, LLC.