The monthly Renewables MMI® held steady for the second straight month, keeping its value of 67 in May.
This index, composed of metals integral to the renewable energy sector, has mainly been buffeted about by steel plate and grain-oriented electrical steel prices, the former dropping steadily over the past six months or so in the US and Japan. Plate prices in Korea and China, however, have buoyed the complex.
(As we’ve reported earlier this week, steel prices generally remain supported, even though globally an oversupply issue threatens the market.)
As far as the US power sector goes, the latest Census report on total construction spending in that sector has declined a seasonally adjusted rate of 2.7 percent, down to $98.2 billion from February to March this year. However, overall power spending is up 4.3 percent year-over-year, and the total dollar amount remains at the higher end of its range over the past several years, peaking at $116 billion in Dec. 2012.
Tellingly, our Renewables MMI® has hewn pretty closely with this metric month-to-month for the last several months, as you can see in the graph below:
In terms of total public, nonresidential power construction, the amount has risen a solid 28.6 percent over the past year. Coupled with the fact that the US government’s Department of Energy (DOE) pushing projects and job creation in the renewables industry, perhaps bodes well for the price index’s support going forward.
Key Price Drivers
The price of Japanese steel plate closed the month after dropping 10.0 percent. After rising the previous month, US grain-oriented electrical steel (GOES) prices dropped 5.0 percent. Chinese steel plate fell a slight 2.3 percent over the past month. Silicon closed the month down after dropping 1.5 percent.
Chinese cobalt cathodes rose 0.5 percent. US steel plate recorded a 0.3 percent increase.
Prices for neodymium ticked up very slightly this past month. Korean steel plate traded almost sideways last month, increasing slightly as well.
The Renewables MMI® collects and weights 8 metal price points used extensively within the renewable energy industry to provide a unique view into renewable energy metal price trends over a 30-day period. For more information on the Renewables MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.