Industry News

Rio Tinto has cut its guidance for iron ore shipments and U.S. consumer confidence unexpectedly fell this month.

Rio Tinto Cuts Back Iron Ore Guidance

Global miner Rio Tinto on Thursday cut its 2016 guidance for iron ore shipments by as much as 5 million metric tons after releasing lower third-quarter production data, citing shipping interruptions.

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

The downward revision — equivalent to as much as $290 million at current ore prices — comes as the steelmaking commodity stages a recovery on the back of a surprise lift in demand from China.

U.S. Consumer Confidence Falls

Consumer confidence unexpectedly fell to a one-year low in October as Americans soured on the outlook for the economy amid a contentious presidential election campaign.

The University of Michigan preliminary index of sentiment declined to 87.9 from 91.2 in September, according to a report Friday. That was weaker than the lowest estimate in a Bloomberg survey of economists. Long-term inflation expectations declined to a record low.

The American Iron & Steel Institute, a key lobbying force for the steel industry, is focused on two major policy issues for the remainder of the year: getting the G20-initiated “Global Forum” on steel overcapacity officially in motion before the Obama administration leaves office, and ensuring that the U.S. continues to refuse to recognize market economy status for China.

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

“If China gets market economy status it will mean 400,000 to 600,000 lost jobs (in steel, other metals and services for the industries) the U.S.,” said Thomas J. Gibson, President and CEO of the AISI in a conference call with reporters yesterday.

When asked what the position of the AISI is, as opposed to that the U.S.-China Business Council, AISI Senior VP for public policy and general council Kevin Dempsey said, “what the Chinese are trying to present is sort of a legalistic argument that, regardless of the facts, they should be granted the status. I don’t think that legal argument stands up to scrutiny.” Read more

Many believe gold will again reach $1,300 an ounce next year and China now imports more crude oil than the U.S.

Gold Above $1,300/Ounce? Next Year, Poll Says

Gold is likely to recover to above $1,300 an ounce next year as a pickup in physical demand counters more potential U.S. rate increases, a Reuters poll at an industry event showed.

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

The precious metal had lost nearly 9% from July’s two-year highs to trade around $1,255 an ounce on Tuesday, hit by expectations the Federal Reserve would raise interest rates in December for the second time in a year.

China Overtakes U.S. as Top Crude Oil Importer

China imported record volumes of crude oil last month, eclipsing the U.S. as the world’s top buyer of foreign oil as Beijing’s state reserves shipped in cheap crude to fill new storage tanks.

Two-Month Trial: Metal Buying Outlook

September’s crude imports rose 18% from a year earlier to 33.06 million metric tons or 8.04 million barrels per day (bpd) on a daily basis, customs data showed.

Chinese aluminum companies are looking to get into the lucrative aerospace and automotive markets while U.S. oil drillers are ramping up production with oil above $50 per barrel.

China Eyes Automotive, Aerospace Aluminum Markets

China’s giant aluminum makers are pushing into the global automotive and aerospace markets, with industry sources expecting their presence to heat up competition and possibly spark a buying spree for Western metals companies.

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

China’s top aluminum companies are venturing into the more lucrative parts of the global value chain.

US Drillers Extend Rig Recovery

The number of oil rigs drilling in the U.S. rose again this week, extending one of its best recoveries with no cuts for 16 straight weeks, with analysts expecting more additions as crude prices hold over $50 a barrel. Drillers added 4 oil rigs in the week to Oct. 14, bringing the count up to 432, the most since February, but still below 595 rigs a year ago, according to energy services firm Baker Hughes Inc. on Friday.

Regulators have begun an investigation into imports of rebar from three countries and the World Steel Association believes the global sector’s long crisis will end next year.

Rebar Anti-Dumping

Today, the Commerce Department announced the initiation of anti-dumping investigations of imports of steel concrete reinforcing bar (rebar) from Japan, Taiwan, and Turkey, and a countervailing duties investigation of imports of the same merchandise from Turkey.

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

The investigations cover steel concrete rebar, which is used primarily as a structural agent to increase concrete structures’ resistance to tension, compression, temperature, and/or shear stresses.

The International Trade Commission will rule by November 4, initially, on whether or not the rebar imports and being dumped and subsidized.

World Steel Association Believes Crisis is Easing

The global steel sector crisis that prompted high profile plant closures and job losses last year is easing, with demand set to grow this year and next, the World Steel Association told its conference in Dubai on Tuesday.

Two-Month Trial: Metal Buying Outlook

In 2017, it expects global steel demand to grow 0.5% year-on-year to 1.510 billion metric tons while this year, Worldsteel sees demand up 0.2% to 1.501 billion mt.

Alcoa opened up earnings season with disappointing results and China seems to have sided with North Korea on U.N. sanctions on its coal exports.

Alcoa Earnings Disappoint

Metals manufacturer Alcoa, Inc., posted a higher third-quarter profit, but revenue fell and discouraged investors punished the company’s stock.

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

In the final reporting period before it splits into two companies in November, Alcoa’s net income more than tripled from $44 million a year ago to $166 million in the third quarter. Excluding one-time items, adjusted net income increased 47.7% to $161 million. But total revenue fell 6.5% to $5.2 billion. The company cited “curtailed and closed operations” and lower pricing for its products. Alcoa asset sales are expected to total $1.2 billion for the year.

Alcoa shares plunged 10.7% to $28.15 at 2:15 p.m. Tuesday.

China Pushes Back on North Korean Coal Sales

China appears to have pushed back on a U.S. bid to close a United Nations. loophole that allows North Korea to export coal for “livelihood purposes,” saying the well-being of North Koreans is a priority in negotiations on possible new U.N. sanctions on Pyongyang.

Two-Month Trial: Metal Buying Outlook

Since North Korea’s fifth and largest nuclear test four weeks ago, the U.S. and China, a close ally of North Korea, have been negotiating a new draft Security Council resolution to punish Pyongyang.

Tariffs were place on Chinese steel imported into the E.U. and the Commerce Department. placed more on phosphor copper coming into the U.S.

EU Tariffs on Chinese Steel

The European Union will impose duties on two grades of steel imported into the currency bloc from China to counter what it says are unfairly low prices.

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

The duties are set at between 13.2 and 22.6% for hot-rolled flat iron and steel products and at between 65.1 and 73.7% for heavy-plate steel, according to a filing in the European Union’s official journal.

Anti-Dumping Duties on Phosphor Copper

Not to be outdone, The Department of Commerce placed tariffs on allegedly dumped imports of phosphor copper from the Republic of Korea yesterday.

Two-Month Trial: Metal Buying Outlook

Commerce found, preliminarily, that dumping occurred by mandatory respondent Bongsan Co. Ltd. by a dumping margin of 3.79%. All other producers from South Korea also received 3.79% anti-dumping duties. U.S. Customs and Border Patrol will now collect cash deposits upon import of the copper. The petitioner is Metallurgical Products Company of Pennsylvania.

According to SIMA data, steel imports fell in September and gold is seeing a bounce back as bargain hunters take advantage of its low price.

Steel Imports Fall

Based on the Commerce Department’s most recent Steel Import Monitoring and Analysis (SIMA) data, the American Iron and Steel Institute (AISI) reported today that steel import permit applications for the month of September totaled 2,846,000 net tons.

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

This was a 7% decrease from the 3,066,000 permit tons recorded in August and a 5% decrease from the August preliminary imports total of 2,989,000 nt. Import permit tonnage for finished steel in September was 2,090,000 nt, down 9% from the preliminary imports total of 2,307,000 nt in August.

For the first nine months of 2016 (including September SIMA permits and August preliminary data), total and finished steel imports were 24,808,000 nt and 19,691,000 nt, down 20% and 22%, respectively, from the same period in 2015. The estimated finished steel import market share in September was 25% and is 25% year-to-date.

Bargain Hunters Buy Up Physical Gold

Physical gold demand in London jumped after this week’s big price drop, dealers said yesterday.

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

Bargain hunters came to the market because of the metal’s technically-driven slide. Online gold trading platform saw its heaviest trading day on Tuesday since its all-time record on June 24, the day of the U.K. referendum result on European Union membership.

Finished steel imports into the U.S. were down in August and Indonesia may finally restart shipments of raw ore to other countries, which could bring nickel back to China.

Steel Imports Still Down

Based on preliminary Census Bureau data, the American Iron and Steel Institute reported recently that the U.S. imported a total of 2,989,000 net tons (NT) of steel in August, including 2,307,000 net tons of finished steel. That’s down 8.5% and 6.6%, respectively, vs. July final data.

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

Year-to-date, through eight months of 2016, total and finished steel imports are 21,962,000 and 17,601,000 nt, down 22% and 23%, respectively, vs. the same period in 2015. Annualized total and finished steel imports in 2016 would be 32.9 and 26.4 million nt, down 15% and 16%, respectively, vs. 2015, if the current trends hold.

Finished steel import market share was an estimated 25% in August and is estimated at 25% on the year-to-date.

Key finished steel products with a significant import increase in August compared to July are standard pipe (up 33%), wire rod (up 23%), structural pipe and tubing (up 18%) and hot-rolled bars (up 15%).  Tin plate (up 12%) had a significant year-to-date increase vs. the same period in 2015.

Indonesian Mining Rules

Indonesia is finalizing an overhaul of its mining rules that could give companies up to five more years to build smelters, and reopen exports of nickel ore banned since 2014, the country’s mining minister said on Tuesday.

Two-Month Trial: Metal Buying Outlook

The proposed changes provide a way around a 2017 deadline for full domestic processing of mineral ore, potentially pushing completion of that aim to 2022, but also possibly undermining investor confidence.

The IMF has downgraded its U.S. growth outlook and Canada’s Goldcorp has been forced to shut down one of its largest mines in Mexico.

IMF Downgrades U.S.

The International Monetary Fund is downgrading its forecast for the U.S. economy this year and warns that political discontent threatens global growth.

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

The IMF on Tuesday cut its estimate for U.S. economic growth in 2016 to 1.6% from the 2.2% it had predicted in July. The American economy grew 2.6% in 2015. The fund’s dimmer outlook for the U.S. occurs even as the Federal Reserve is thought to be preparing to raise interest rates in December.

The global economy will expand 3.1% this year, it said — the same as forecast in July.

The IMF described worldwide growth as “subpar,” with a slowdown in the U.S. and other advanced economies being offset by slightly stronger output in developing and emerging nations.

Goldcorp Shuts Down Blockaded Mexican Mine

Goldcorp Inc. said on Monday it was temporarily shutting down its Peñasquito gold mine in Mexico as it was unable to safely continue operations due to a week-long blockade by a trucking contractor, sending its shares down nearly 5%.

Two-Month Trial: Metal Buying Outlook

The world’s No. 3 gold miner by market value said it was unable to bring in food, water and fuel for the 750 people on the site, which has been blockaded by a contractor concerned about losing business due to efficiency improvements at the mine.