Renewables Steady; SolarWorld in Silicon Fight; GE Makes Big Bid for Alstom

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The monthly Renewables MMI® registered a value of 64 in June, steady with May’s value.

The flat month was actually a positive as renewables were down from April to May and has been having a remarkably flat year not moving out of the 63 to 65 range since December.

Renewables MMI June 2014

The metalloid that garnered the most attention this month was silicon, based on its use in crystalline photovoltaic solar panels. The US solar industry is one of the shining stars of the renewables sector, now supporting jobs for 140,000 Americans with increasing sales of panels year-over-year for the past 7 years. It was not a good week to be an importer of Chinese solar panels, though. The Commerce Department slapped initial import duties on the energy-generating silicon products from China as well as building integrated panels (walls and roofs with the silicon built right in).

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This fight over solar panels pits German industry giant SolarWorld against smaller solar panel manufacturers from China currently doing booming business thanks to federal and state tax incentives to make homes and businesses more sustainable or “green.” Elon Musk’s SolarCity is one of the companies reaping rewards from selling the cheaper Chinese panels.

As I have mentioned before, it’s a battle between a German company waving the US flag and a hundreds of Chinese manufacturers whose production is highly subsidized by Beijing as solar expansion is one of China’s central government’s main goals. The Chinese manufacturers are almost all buying their raw silicon from the western US, anyway. Silicon that China can turn around and place import tariffs on if they want to play hardball.

Speaking of Germany, Siemens is still looking at French energy giant Alstom. With the conglomerate’s deadline fast approaching, Siemens must decide whether to counter GE’s offer for Alstom’s energy business. Crafting a proposal that will win over Alstom’s board will be difficult.

GE set the bar high with a $17 billion offer, valuing Alstom’s power business at 7.9 times earnings before interest, taxes, depreciation and amortization, a big premium to Alstom’s group valuation, according to the Wall Street Journal. The deadline for a counter proposal from Siemens is June 16th.

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Following a 3.3 percent change in price, US steel plate closed the month at $848.00 per short ton. At $33,113, Chinese cobalt cathodes finished the month up 1.5 percent per metric ton.

Chinese steel plate prices decreased by 2.6 percent this month, ending at $599.88 per metric ton. US grain-oriented electrical steel (GOES) decreased by 1.1 percent this month, ending at $2,890 per short ton.

The price of silicon held steady around $2,280 per metric ton last month. Neodymium experienced a flat month, staying around $66,386 per metric ton. Korean steel plate held pat last month at $881.23 per metric ton. Japanese steel plate traded sideways last month, staying around $745.95 per metric ton.

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.

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