Articles in Category: Humor

After the market tumult of last week, many expected things to calm down and that China’s stock market would finally calibrate to the new, devalued yuan/renminbi while equity markets elsewhere would bounce back from Friday’s big sell. Heck, maybe even the beleaguered commodity markets might recover some of their losses, right?

Free Sample Report: Our Monthly Metal Price Outlook

Wrong. Oil reentered a bear market on Tuesday extending the previous day’s losses, when Brent crude — the international benchmark — recorded its biggest one-day sell-off since February. After dropping more than 6% on Monday, Brent fell a further 2% in the next trading session to $55.40 a barrel. It is down more than a fifth from its year-high of $69.63 a barrel reached during intraday trading in May.

Not the Oil That Made Jed Clampett Rich

Not such a good time for oil companies but, at the very least, gas prices are down here in the US and costs for everything from construction to automobile production is down, too, right, so we must be on to step three, profit, right? Oh no, not even close. Construction material prices are down, but new construction spending isn’t exactly picking up, either. Not here and not in China, where lack of demand has led lead and zinc to five-year lows.

Jedclampett

Jed Clampett made $9.5 billion in oil and gas. That likely would not have happened with today’s prices.

Incidentally, Forbes estimated Jed’s net worth at $9.5 billion, 4th on its “Fictional 15″ list. That’s more than weapons tycoon Tony Stark (#6). Not bad for wealth based entirely on oil and gas discovered while hunting possums.

A Rebound in Stocks… Of Sorts

The Dow Jones Industrial Average has been back in positive territory, though, saving our collective retirements and paring the losses we saw last week. The Dow gained 369 points yesterday, alone, curbing the big losses from Friday and Monday. It’ll surely last, right? Ummm, no promises. While our own Stuart Burns acknowledged the rebound in western markets, he also cautioned that aftershocks from China’s economic crisis could be forthcoming.

“With (Chinese) GDP growth widely believed to be lower than the official government number of 7% it is hard to see how domestic consumption can pick up as households lick their wounds,” Burns wrote.

Free Download: Latest Metal Price Trends in the August MMI Report

So, in short, expect more volatility as China spares the rod of economic depression while spoiling the child with purposely devalued currency.

What Does This Mean for US Buyers?

Expect to pay less for Chinese steel. We know, it’s already dirt cheap as foreign imports were up 5% in July. The job of policing foreign dumping into the US market just got tougher.

 

Welcome to crazy MetalMiner’s low, low price week of falling metal prices, oil prices and devalued currency.

EVERYTHING MUST GO! Or Not…

…maybe prices will be lower next week? Who can tell in this crazy market? Check out our Metal Price Outlook for MetalMiner’s expert opinion. Free sample in the link.

Bears Everywhere

Our August MMI Report shows that nine of the 10 metals we track have hit an all-time low since we started tracking them in January 2012. It’s been a gradual fall for sub-indexes such as raw steels and renewables, whereas aluminum and copper suffered big drops this month that coincided with historic London Metal Exchange lows.

Three Best Practices for Buying Commodities

The strong dollar continues to drag down all commodities, shunting investment dollars elsewhere and depressing prices of investment metals such as gold, which hit a six-year low last quarter, according to the World Gold Council. Guess what else hit a six-year low? Oil, of course! Read more

A giant robot fight will happen sometime next year.

I won’t try and justify this by the metal content — which is interesting in its own right  — or by the turn of fortunes that has been created by taking an old repair shop for cargo ships and turning into a new industrial enterprise, admirable as that is, no this posts stands on its own two mechanical feet as pure fun.

Free Download: July Metal Price Forecast

The robot constructors of the American entry are three engineers who basically wanted to live out their childhood fantasies and build a fighting robot. Weighing in at 12,000 lbs. and measuring some 15-ft. tall the MegaBot MKII is everything a child could imagine and more.

MegaBot Mk11

MegaBot MKII. Image courtesy of MegaBot.

The backers have found a worthy opponent in Japan’s Suidobashi Heavy Industries Kuratas, against whom they can wage war. Read more

John W. Miller of the Wall Street Journal wrote an excellent piece yesterday about how metals are marketed these days. Who hasn’t heard “as strong as steel, as lightweight as aluminum or as luxurious as platinum?”

StuartsF35_500

That soda can you’re drinking from is made from aluminum, just like the kind this jet fighter’s skin is made out of! Well, okay, not EXACTLY the same kind.

Often billed for its strength, steel is one of the most frequently mentioned metals in advertisements and Miller noted that Ford Motor Co. touted its Sierra Truck as made of rolled steel like “the hulls of submarines.”

Three Best Practices for Buying Commodities, Especially Super-Strong Aluminum!

Metallurgist John Tuzamos, an investor in metals companies, is quoted saying “the reason those hulls are so strong is that they’re coated with titanium.”

The strongest alloy available isn’t steel or titanium, either, except in metals marketing. That distinction has been taken over by barely marketed ultra-strong magnesium, which has seen advances in strength for a lightweight metal in recent years.

Platinum Jewelry vs. Platinum Uses

We have often noted the funny ways metals are marketed in the overall media here at MetalMiner. We counted on Taylor Swift last year to keep 2014 from being the first year on record in which there was no Recording Industry Association of America platinum album, a distinction tied to the jewelry and investment uses of the precious metal… even though its industrial uses such as automotive exhaust systems are more prevalent. Read more

jeff yoders chicago cubs 1060 project

Ahoy from the corner of Waveland and Sheffield.

After covering ‘Steel Dumping 101′ in Part 1 and how the grain-oriented electrical steel market is different in Part 2 of our inaugural podcast episode, we turn to a more random endeavor – checking out the Chicago Cubs’ 1060 Project at Wrigley Field to get our structural steel fix.

With Pepper Construction as the general contractor on the project, Jeff and I wanted to get some eyes on the latest phase of development. So how many tons of structural steel are likely involved here? What are some of the sourcing considerations for an undertaking such as the 1060 Project? And most important, what do the fans have to say about steel sourcing? Listen below!

Music: “All Those Devils…” by Holy Pain (http://www.myspace.com/holypain)

I recently read in USA Today about a theft in Kentucky in which the most valuable piece of loot was a stainless steel barrel full of 17-year-old Eagle Rare bourbon, valued around $11,000.

stainlessbareel

A humble stainless barrel containing $11,000 in aged bourbon was recently stolen. Photo: Gregory A. Hall, The (Louisville, Ky.) Courier-Journal)

In my time in the stainless industry I have heard of stainless steel being used in wine tanks and in the tequila-making process, but I was surprised to hear that stainless barrels are now being used in the making of bourbon.

Free Download: July Metal Price Forecast

After all, it is the unused charred oak barrel that flavors bourbon as it ages.

Why Stainless?

During the traditional oak process, though, some liquid evaporates from the barrels—about 2% each year, according to Whiskey Magazine. The loss can be even greater in hotter climates such as Kentucky’s. The part lost is referred to as the “angel’s share” because it is the part of the bourbon the maker is supposedly sharing with the angels.

The theft of the stainless barrel of bourbon highlights one part of the process that many bourbon distillers would likely prefer the world not know about. The stainless barrel is used to store already aged bourbon until it needs to be bottled. Stainless steel doesn’t impact bourbon’s flavor, so the product can remain in the barrels for years until it’s ready to bottle. The longer some bourbons age, the more they can cost on the market. The use of stainless steel barrels in bourbon-making became more common in the 1990s.

The added benefit of storing bourbon in stainless rather than other oak barrels is that the distiller is not giving any more to the angels. Stainless steel barrels won’t allow our precious bourbon to evaporate. So, thank goodness for stainless steel barrels to ensure that the angels don’t overimbibe on America’s Native Spirit.

Free Download: Last Week for the June MMI Report

At the Metalminer Week-In-Review, we promise to report accurate prices every day through our Indx. But what if that’s not enough? What about the add-ons, over-and-aboves and shipping charges? Buying steel? We’ve got bar fuel surcharges for eight US regions. Eight!

Free Webinar: Are You Speculating When You Buy Spot Metals?

We’ve been covering that pesky Midwest aluminum premium like Richard Sherman on a wideout, too. Want to know about anti-dumping and countervailing duties. You’ve come to the right place! All of these non-price inputs made our homepage this week as the gulf between the price and what you actually pay reared its head again this week.

Who Polices the Midwest Premium?

With falling London Metal Exchange aluminum prices and much-reduced physical delivery premiums even the combined, all-in price of aluminum is below cost for many smelters these days.

Pile of aluminium bricks waiting for transport to the factory

I’m aluminum, get me out of this warehouse!

That’s enough reason for smelters such as Alcoa, Inc., to question the involvement of the Commodities Futures Trading Commission in discussions with the LME on how best to reform their warehouse network and cut down the one-year-plus wait to get ingots out of the operations in Detroit (Metro International) and Vlissingen, Netherlands (Pacorini).

Higher premiums benefit producers such as Alcoa and UC Rusal, after all. Is it any wonder that producers want the CFTC to butt out? Yet, the CFTC still wants to butt in.

Don’t Let Your Profitability Drown in the VAT!

Meanwhile, over in China, rampant speculation is going on over how Beijing will replace its current business tax system with a new system of value-added taxes. A VAT taxes the difference between the sale price charged to a customer, minus the cost of materials and other taxable inputs.

container-ship-night-MMslider

Better pay the VAT or this is going to be a short trip!

The best estimates we have seen show that the new VAT will considerably increase what US buyers pay for metals from China and likely from nearby markets trying to compete with Chinese steel. China’s VAT is just one of many ways that imports could become more expensive later this year as… Read more

This week our metals faced off against a resurgent US dollar and, once again, lost ground.

Free Download: Latest Metal Price Trends in the May MMI Report

It’s enough to make a metals trader or buyer need a stiff cocktail. How about a nice Moscow Mule in a copper mug? Two ounces of vodka, four ounces of ginger beer and one ounce of lime juice just isn’t the same in glassware. How can your fizzy ginger beer be served in plain, old glassware? Well, badly.

Moscow Mule in a Copper Mug. This is a Vodka drink served with mint, and a garnished with a wedge of lime, The image is a cut out, isolated on a white background, and includes a clipping path.

Moscow Mule in a copper mug, the best medicine for low copper prices.

When vodka comes into contact with the walls of a copper mug, oxidation begins which boosts the aroma, and in turn s taste of vodka. Cold copper may increase the amount of bubbles in the ginger beer, offering maximum fizz to the cocktail. Even the taste of the lime juice is enhanced by cold copper, and it reduces the acidity of the drink to complement the ginger beer.

Served Better in Metal

The original Moscow Mules demanded strict eight-ounce copper mugs, even. Sadly, the mixology craze has not yet pushed enough copper mugs onto shelves to effect the Copper MMI. If prices stay low, perhaps more and more mules will be sold and more bars will invest in copperware causing a Friedmanian run on copper. Pass me another full mug, please.

Our Russian friend is not the only cocktail to be enhanced by delivery in a metallic vessel.

Silver and Mint Juleps

Mint Juleps are said to be better served in silver cups, again to enhance the taste of the mint and the bourbon, although this precious metal investment is a bit more pricy than the copper mugs of the pride of Moscow.

FOMIJU01

Mint Juleps getting an extra kick from silver cups.

With summer upon us, it’s a good time to break out the metal drinking vessels, anyway, and get the best outdoor experience from your oxidizing and cold, metal vessels. That and it’s barbecue season. Even foodsafe stainless steel has gotten into the act. Hard to believe that there was a time when beers weren’t packaged in aluminum cans, isn’t it?

Make sure to enjoy your metal-cupped cocktails safely this summer. No one wants their next drink to come from a tin cup.

Our May MMI Report, tracking ten major  metal price points, came out this week.

Pool 4 Tool’s Automotive SRM Summit

As always, the MMI reflects the global market (BLS indexes by default only include US data, but that may or may not be representative of underlying global price trends) and metal prices often depend upon the underlying demand for various industries (steel prices relate to construction industry activity, for instance).

Most of our readers are buyers of aluminum, copper, stainless steel, raw steels, rare earths, renewables and grain-oriented electrical steel… but some go for the VERY minor metals.

For these special users, we provide the fictitious MMI. Serving all your needs for adamantium, Rearden Metal, kryptonite ore and vibranium. We recently had to move unobtainium off the list because it’s information was just too hard to obtain to keep listing.

These highly rare metals are difficult to source and procure. Some of them haven’t even had deposits discovered since the 1960s. Kryptonite ore isn’t even native to Earth. Still, like all metals they are subject to market forces, so here’s what’s affecting each super-rare metal’s market.

Vibranium MMI

If you’ve seen “Avengers: Age of Ultron,” you know that vibranium is the metal Captain America’s shield is made out of. It’s a rare, naturally occurring metal that possesses the ability to absorb all vibrations in the vicinity as well as all kinetic energy directed at it.

Vibranium

The problem with the vibranium market is similar to the one we’ve seen with its real world cousins, the rare earths. One nation controls almost all production of vibranium, the African nation of Wakanda. As most production of rare earths comes from China, export quotas, over/underproduction and other measures have allowed China to distort the global market to cement its grip on the magnet and battery elements for some time now.

hulkbuster_armor550

The many uses of vibranium include Hulkbusting. Photo: Marvel Studios

Wakanda is no different in the make-believe Marvel universe. They likely have a version of “60 Minutes” running stories on how dangerous the Wakandan monopoly on rare earths truly is. Ones that call for more domestic vibranium mines and even exploration in pristine Antarctica. Read more

The big news in metals this week was China’s economy growing at the slowest rate since 2009. If our bearish markets are to turn around this year, it would appear they’re going to have to do it without help from the world’s second-largest economy.

Free Webinar: MetalMiner’s Q2 and Q3 2015 Forecasts

But that’s not all that we learned from China this week. In many ways, China doesn’t really look like an economy growing at even 7%, with exports plunging in March, power generation dropping 3.7%, and a host of other indicators pointing to sluggish growth. This is bad because most of the demand for our metals is based on China at least maintaining 7.5% economic growth. In today’s world economy, if you’re not growing, you’re dying.

Steel_bars_450

Only more demand for Michael Bolton records can create more sales of Michael Bolton albums. It’s the same for real steel bars. The international steel market, right now, is Michael Bolton records.  Image courtesy of Columbia Records.

The normal response from Beijing is to stimulate domestic industries, such as steel and copper production, with government spending, but Reuters’ Clyde Russell writes that increased economic stimulus spending by Beijing may not be able to do much, at least not for this fiscal year. So much for an easy fix.

Read more