Articles in Category: Commodities

The Department of Commerce placed anti-dumping duty and countervailing duties on imports of welded stainless pressure pipe from India today. This was a final determination that affirmed Commerce’s previous preliminary determination in March.

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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.

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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.

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.

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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.

Clipperdata_OPEC_Production_500_092416

Source: Clipperdata.

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.

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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.

China’s steel industry will see demand drop even further in 2017 and the Federal Reserve left rates unchanged yesterday.

CISA: Chinese Steel Demand Will Fall More

China’s steel demand is likely to drop for a third year in a row, an industry official said on Thursday, as mills in the world’s top producer focus on reducing capacity.

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China’s crude steel consumption slipped 1.9% from January to July and there may be a slight drop for the year, said Wang Liqun, vice chairman of the China Iron and Steel Association (CISA).

Fed Leaves Rates Unchanged Again

U.S. stocks marched higher on Thursday, with the Nasdaq hitting a record intraday high, as investors cheered the Federal Reserve‘s decision to not raise interest rates yesterday.

While the Fed said the risks to economic outlook were roughly “balanced”, it left rates unchanged for want of “further evidence of continued progress”. Inflation remains below the central bank’s target of 2 percent and members saw room for improvement in the labor market.

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Even if the Fed raises rates at its last meeting of the year in December, many are worried that Central Banks toolkit for hitting inflation targets is ineffective.

Siemens and Local Motors announced a new partnership at the recent International Manufacturing Technology Show in Chicago, which is intended to help advance the future of manufacturing by optimizing the development and large-scale 3D printing of automobiles.

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The partnership combines the power of Siemens’ product lifecycle management (PLM) software technology with Local Motors’ leadership in co-created and 3D-printed vehicles — a process called direct digital manufacturing (DDM), wherein parts are produced directly from CAD files.

IMTS_olli_local_motors_550_092016

All 115,612 International Manufacturing Technology Show attendees could ride Olli, Local Motors’ first 3D-printed, autonomous vehicle to get around the massive show floor. Source: IMTS.

Local Motors plans to enhance productivity in its LM Labs program by leveraging Siemens’ expertise in creating “digital twins,” while Siemens expects to further enhance its digital enterprise software suite to support the latest advances in additive manufacturing/3D printing.

For the first time, Local Motors provided an autonomous vehicle, “Olli” that ferried IMTS goers throughout the halls of McCormick Place. The vehicle used Watson’s capabilities to enable riders to ask complex questions in “natural language” voice such as where to visit in Chicago while in town. Olli can be hailed by an app and is in real-life testing Local Motors testing locations right now including National Harbor, Md., Las Vegas and, later this year, Miami. The autonomous vehicle can take route instructions and explain what’s happening during the trip.

Local Motors brought other 3D-printed vehicles — including Strati, the first 3D-printed show car created at IMTS 2014 — tot the show, too.

On the Siemens side of the partnership, the PLM software provider insists that additive manufacturing is not in direct competition with existing manufacturing processes and will not completely replace them.

“Instead, 3D printing will provide an ideal complement to traditional procedures like injection molding and milling,” said Ulli Klenk, chairman of the board of the Additive Manufacturing Association within VDMA — a German manufacturing association trade and certification association — and also manager of Siemens’ digital factory division.

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Klenk said the certifications and standards VDMA is working on will bring legitimacy to the technology and, within 10 years, additive manufacturing could effectively be commoditized with 3D printing powders and their prices treated as any other raw materials.

OPEC members are now talking about a deal that lasts one year, whether that means curtailing production for that period is still unknown. Australia is attempting to collect $766 million in taxes.

OPEC Deal Could Last a Year

A possible deal to support oil prices by the world’s leading producer-countries may last for one year, the secretary-general of the Organization of Petroleum Exporting Countries said on Tuesday, longer than other officials have indicated.

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OPEC and non-member producers including Russia are discussing a deal to stabilize the market by possibly freezing output, although key details such as the timing and baseline for any deal have yet to emerge.

BHP Vows to Fight Australian Tax Bill

BHP Billiton said it disagreed with Australian tax collectors’ assessment that the miner needs to pay $766 million in back taxes and charges for its Singapore commodities marketing hub, and that it could resort to court action to fight the claim.

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BHP is under investigation by the Australian Tax Office (ATO) for allegedly shifting billions of dollars in iron ore profits through marketing hubs in Singapore, where it operates under an effective tax rate of zero as part of a concessional tax deal.

Metal prices bottomed out earlier this year and ever since we are seeing rising prices. However, was that the ultimate bottom after a five years of a bear market? Are metal prices set to continue running higher in 2017?

Industrial metals ETF flattens in Q3

The industrial metals ETF flattens in Q3. An end to rising prices? Source: MetalMiner analysis of @StockCharts.com data.

These are questions we can’t answer, but they will be answered moving forward. Although industrial metals entered a bull market this year, we have yet to see how long this rising market will last. In Q3 we already witnessed some weaknesses with many base metals struggling to build on this year’s gains.

MetalMiner Price Benchmarking: Current and Historical Prices for the Metals You Buy

We see three critical factors to watch as we move in 2017. These factors will determine the sustainability of this year’s bull market:

Supply Cuts

Some production capacity was closed this year to fight low prices and the market now seems more balanced than last year. These supply cuts helped push metal prices higher, but the problem is producers might now have enough incentives to restart production. A good example is the zinc market. Zinc prices rose sharply this year thanks to supply cuts, but now markets wonder if Glencore and China’s zinc miners will start upping their production to reap the rewards of higher prices. Read more

Chinese authorities have frozen money invested by commodity trader Trafigura in a copper smelter there and Venezuela claims that an Organization of Petroleum Exporting Countries  (OPEC) agreement to curtail production will come together soon.

Trafigura Sees its Chinese Copper Smelter Stake Frozen

Chinese authorities have frozen part of commodity trader Trafigura’s investment in a Chinese copper smelter as part of a years-long probe into the Swiss firm’s oil trading, according to documents from the police and banks reviewed by Reuters.

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In October, police in the northern Chinese city of Cangzhou, froze $32.9 million Trafigura Pte Ltd had injected into the metals project, a joint venture with Chinese metals producer Jinchuan Group Co Ltd  in the southwestern city of Fangchenggang, documents dated Oct. 28, 2015 show.

OPEC Output Deal Imminent?

Venezuelan President Nicolas Maduro said on Sunday that OPEC and non-OPEC countries were close to reaching a deal to stabilize oil markets and that he aimed for a deal to be announced this month.

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OPEC members may call an extraordinary meeting to discuss oil prices if they reach consensus at an informal gathering in Algiers this month, OPEC Secretary-General Mohammed Barkindo said during a visit to Algeria, the country’s state news agency, APS, reported on Sunday. Venezuela’s economy has been facing complete collapse for more than a year now as oil prices have seen prices fall by more than half during that time.

The industrial metals complex saw prices slip nearly across the board in August as volatility
returned to stock markets and investors lost confidence in central banks’ ability to increase
growth.

MM-IndX_TRENDS_Chart_September2016_FNL-TOPVALUE100

Even the vaunted Global Precious MMI, which has enjoyed large gains this year due to safe
haven status, dropped this month. It experienced a 4.5% loss. Our Construction MMI and the Grain-Oriented Electrical Steel MMI indexes saw increases this month, but every other sub-index either saw a 2-5% loss or held flat.

MetalMiner Price Benchmarking: Current and Historical Prices for the Metals You Buy

This was somewhat expected as metals such as steel and aluminum remain in a global oversupply situation and metal prices don’t move in a straight line. They zig-zag. Our metal price benchmarking service has thousands of transaction prices to reference as evidence of that.This could be merely a one-month correction or it might signal that the weakness in metals markets is finally denting the bull run of strong price performers such as gold and platinum. Stay tuned next month for more.

China is planning a bailout of sorts for Bohai Steel Group and standards organization ASTM International wants to develop certifications for commercial space flight.

A New Lifeline for Bohai Steel

Financial authorities in Tianjin, China, plan to convert a portion of debt-stricken Bohai Steel Group‘s liabilities into bonds, according to rescue plans drawn up recently, the online financial magazine Caixin reported on Monday.

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According to the plan, high-quality assets from Bohai Steel will be restructured to form a new company, which will take on 50 billion Chinese yuan of the total debt. Officials met last week to discuss a comprehensive restructuring plan for the firm, which has liabilities of $28.78 billion (192 billion yuan) from 105 creditors.

ASTM Seeks To Develop Private Space Travel Standards

ASTM International will host an organizational meeting to potentially create a new technical committee that develops voluntary consensus standards for commercial spaceflight.

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This meeting comes in part as a result of the updated U.S. Commercial Space Launch Competitiveness Act of 2015 (SPACE Act). The U.S. Federal Aviation Administration’s Commercial Space Transportation Advisory Committee (COMSTAC) Standards Working Group is recommending the organization of the new group.

Republican Presidential Nominee Donald Trump recently said he would scrap some controversial EPA plans and rules and allow more drilling for oil and gas on federal lands. Steel companies applauded the Senate’s passage of a new water reclamation bill.

Trump Would Scrap Clean Power Plan

Republican presidential nominee Donald Trump released details Thursday of his proposed energy policy, which includes scrapping the Environmental Protection Agency‘s controversial Clean Power Plan and Waters of the United States rule.

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He also promised to open more federal lands and waters to oil and gas development.

Steel Companies Praise Water Bill

The American Iron and Steel Institute (AISI) recently applauded the U.S. Senate’s passage, by a vote of 95-3, of the Water Resources Development Act (WRDA), which will authorize more than $10 million worth of projects to improve navigation, replace and restore aging locks and dams, and provide aid to Flint, Mich. and other communities in need of replacing pipes, sewers and other drinking water infrastructure.