This Morning in Metals: Aluminum Market Distortions, Nucor Plate Mill and Small Business Concerns

This morning in metals, we’re tracking the following stories.
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  • Global aluminum value chain under fire from China. The OECD has released a report titled “Measuring distortions in international markets: the aluminum value chain,” in which the organization places particular emphasis on unfairly subsidized aluminum in China, according to a release by the Aluminum Association. “Looking across the whole value chain … shows subsidies upstream to confer significant support to downstream activities, such as the production of semi-fabricated products of aluminum,” the report’s opening reads. “Total government support for [17 aluminum firms] reached up to USD $70 billion over the 2013-17 period, depending on how financial support (i.e. concessional loans) is estimated,” the report continued. “Although all 17 firms received some form of support, it is highly concentrated: the top 5 recipients receive 85% of all support, most of it at the smelting stage of the value chain.”
  • Nucor Corp. breaking ground in the Midwest. Reuters reports that Nucor is planning to build a plate mill for $1.35 billion in Sedalia, Missouri, to be fully operational in 2022. The new mill would produce 1.2 million tons a year of plate products and create about 400 full-time jobs, according to the company’s release. “Tax reform, continued improvements to our regulatory approach and strong trade enforcement are giving businesses like ours the confidence to make long-term capital investments here in the United States,” Reuters quoted Chief Executive Officer John Ferriola as saying in a statement.

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  • Small business owners’ confidence in economy, outlook on business conditions weakens yet again. The Wall Street Journal reports (paywall) that the National Federation of Independent Business’ optimism index has fallen for the fourth straight month. “Over the past few months, owners’ expectations for the future have tempered, while reporting continued solid economic activity,” the NFIB said in its report, based on responses from 621 small-business owners, according to the WSJ. “The Index remains at historically high levels but can’t be expected to improve every month.” As the WSJ article noted, “the survey results mirror those from the Conference Board, whose December survey suggested growing economic-growth concerns.”

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