Germany’s steel sector is seeing some (potentially) good news and some bad news this week.
First with the bad: SteelAmericas, ThyssenKrupp’s North American asset, is still wallowing unsold, and with the company’s quarterly results coming, the current situation could sting a bit. Via Reuters: “No agreement appears in sight despite its aim for a deal by the end of September. The longer talks last, the more the benefit of any proceeds is eaten up by losses at Steel Americas. These were over half a billion euros in the first half of ThyssenKrupp’s financial year alone.”
Bad for producers (but potentially good for buyers and the longer-term support of the steel market): Germany, the world’s 7th-largest steel producing nation, cut back on production in July. Via Industry Week: “Steel production is expected ‘in all probability’ to fall 1% in 2013 from last year, to 42.2 million tons, the [German steel association] WVS federation said…It also said steel production in Germany saw a 5.4% drop in July compared to 2012, its sixth fall in a row.”
This could help with global oversupply – although to which extent remains to be seen.
Current Steel and Raw Materials Prices
Strengthening prices ended a two-day flat streak as the steel billet cash price moved up by 8.3 percent on Friday, August 9 on the LME to $130.00 per metric ton. The 3-month price of steel billet increased 6.9 percent on the LME to $155.00 per metric ton.
The China price of iron ore 58% fines from India inched a slight bit higher within its recent range.
After a few days of little change, the price of Chinese slab jumped 0.3 percent. The price of Chinese HRC continues hovering in place for the fifth day in a row.
The US HRC futures contract spot price rose by 0.9 percent to $648.00 per short ton. The 3-month price of the US HRC futures contract rose by 0.6 percent to $620.00 per short ton after a three-day flat streak.