Author Archives: Fouad Egbaria

steelmaking in an EAF

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This morning in metals news: Cleveland-Cliffs reported Q1 steelmaking revenues of $3.9 billion; meanwhile, Novelis added ASI certification for seven more European aluminum manufacturing sites; and, lastly, Tata Steel is suing Liberty Steel over what it says are unpaid debts.

With volatile steel markets, knowing which strategy to execute and when can make all the difference between saving and losing money. See how MetalMiner looks at different market scenarios

Cleveland-Cliffs reports big jump in steelmaking revenues

In its Q1 earnings report, Cleveland-Cliffs reported steelmaking revenues of $3.9 billion. Meanwhile, it reported $337 million in steelmaking revenues in Q1 2020.

Furthermore, the company tallied net income of $41 million, up from a net loss of $52 million in Q1 2020.

In addition, CEO Lourenco Goncalves touted the company’s environmental focus.

“As a country responsible for just 2% of the global steel industry’s GHG emissions, the United States has the right to produce steel and manufacture in America, instead of importing steel and allowing foreign polluting countries to export their full employment at the expense of the American worker,” he said.

Novelis adds seven ASI certifications

Novelis said it has acquired Aluminum Stewardship Initiative (ASI) certifications for seven more aluminum manufacturing sites in Europe.

“The recent certification of Novelis’ seven European plants in Sierre, Switzerland; Göttingen, Nachterstedt Recycling, Nachterstedt Rolling, Germany; Latchford, UK; Pieve and Bresso, Italy strengthen the company’s ability to meet the increasing needs of its customers for independently certified, sustainable aluminium,” Novelis said. “In addition, ASI certifications underline Novelis’ ambition to be the world’s leading provider of low-carbon, sustainable aluminium solutions while reducing its carbon footprint 30 percent by 2026 and being net carbon neutral by 2050, or sooner.”

Tata Steel sues Liberty

As we’ve covered here previously, Liberty Steel is in crisis mode after the collapse of Greensill Capital, the top financial backer of parent group GFG Alliance.

This week, the BBC reported steelmaker Tata Steel is suing Liberty over what it says are unpaid debts.

Per the report, Tata is suing for debts it says are associated with Liberty 2017 purchase of Tata’s specialty steels business.

Find more insight on MetalMiner’s LinkedIn.

electric vehicle charging

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This morning in metals news: General Motors debuted its 2023 Cadillac LYRIQ electric vehicle; the House Judiciary Committee advanced a bill that seeks to open OPEC up to lawsuits for price collusion; and Texas is set to add a significant amount of utility-scale solar power.

The MetalMiner Best Practice Library offers a wealth of knowledge and tips to help buyers stay on top of metals markets and buying strategies.

GM unveils Cadillac LYRIQ EV

General Motors previously announced plans to offer 30 new electric vehicle models by 2025.

This week, the automaker debuted its 2023 Cadillac LYRIQ electric vehicle.

“At launch, LYRIQ will be available with premier technologies and stirring performance capabilities enabled by the vehicle’s dedicated electric architecture,” GM said.

The vehciel features a 12-module, 100 kilowatt-hour battery pack and a rear-wheel-drive Ultium Platform deliver a Cadillac estimated 340 horsepower and 440 Nm of torque — and a Cadillac-estimated over 300 miles of range with a full charge.”

House panel takes aim at OPEC

The House Judiciary Committee this week passed a bill that seeks to open oil-producing alliance OPEC up to lawsuits for price collusion.

“The Organization of Petroleum Exporting Countries, or OPEC, is an international cartel whose members deliberately collude to limit crude oil production as a means of fixing prices, unfairly driving up the price of crude oil to satisfy the greed of oil producers,” US Rep. Jerrold Nadler (D-NY) said in a release. “Such behavior, if done by private companies, would be illegal per se under U.S. antitrust law.”

As a result, the committee moved to advance the No Oil Producing and Exporting Cartels (NOPEC) Act of 2021. The committee passed it via voice vote Tuesday, Reuters reported.

The bill seeks to empower the Justice Department to pursue antitrust enforcement actions against OPEC members.

Texas to add utility-scale solar power

A significant amount of solar power is going to come online over the next two years in Texas, the Energy Information Administration said.

Texas’ added 2.5 GW of solar capacity last year. That marked the beginning of a “solar boom” in the state, the EIA said.

The EIA forecast the state will add 4.6 GW of solar capacity in 2021. Furthermore, it forecast an additional 5.4 GW in 2022. The additions would bring total installed solar capacity in Texas to 14.9 GW, the EIA reported.

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Temperance Beer Co. brewery in Evanston

Source: Temperance Beer Co.

A little over a year has come and gone since the COVID-19 pandemic took hold in the US.

In addition to the immense human toll, the pandemic has changed the way many people live their lives. Work situations have changed, as many have switched out commutes to the office for a morning commute to their living rooms or home office spaces.

Furthermore, consumption habits have changed, too.

In the early days of the pandemic, many stocked up on masks, hand sanitizer and toilet paper.

The pandemic also changed consumers’ habits in other areas. One example? Beverages, namely where they are consumed — that is, not in bars — and in what type of container.

Whereas patrons may have consumed draught beer poured from kegs at a bar, many switched to drinking out of aluminum cans at home.

Naturally, this led to a run on aluminum cans and what has seemed to be a continuous can shortage that persists even now, over a year later.

We chatted recently with Josh Gilbert, owner and founder of local brewery Temperance Beer Co., located at 2000 Dempster St. in Evanston, Illinois.

We talked about what the last year has been like for the business, the shift in consumer habits, the resulting shift in the brewery’s procurement and his outlook for the rest of 2021.

Do you know the five best practices of sourcing metals, including aluminum?

COVID-19 pandemic impact — from keg to aluminum can

For brewers, the COVID-19 pandemic has shaken up their businesses in a number of ways.

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This morning in metals news: US steel capacity utilization reached 78.0% last week; Rio Tinto released its Q1 production results; and the Pilbara Ports Authority reported March shipping figures.

The MetalMiner Best Practice Library offers a wealth of knowledge and tips to help buyers stay on top of metals markets and buying strategies.

US steel capacity utilization up to 78.0%

steel arrow up

Pavel Ignatov/Adobe Stock

The US steel capacity utilization rate for the week ending April 17 reached 78.0%, the American Iron and Steel Institute (AISI) reported Monday.

US mills produced 1.77 million net tons during the week. Furthermore, the weekly output marked an increase of 0.5% from the previous week. Meanwhile, compared with the same week in 2020, output rose by 42.7%.

Production has reached 26.7 million net tons in the year to date, or up 0.1% from the same period last year.

Rio Tinto releases Q1 production results

Miner Rio Tinto reported Q1 aluminum production of 803,000 metric tons, a 3% year-over-year increase.

Meanwhile, copper production reached 120,500 metric tons, down 9% year over year. The miner cited lower recoveries and throughput at its Escondida and Kennecott mines. Furthermore, Chinese border restrictions have impacted shipments from the Oyu Tolgoi mine in Mongolia, Rio Tinto said.

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This morning in metals news: Century Aluminum and the United Steelworkers union reached a five-year labor agreement at the Hawesville smelter; meanwhile, Ford reported its Q1 sales results in Europe; and, lastly, miner Anglo American said it will now source 100% renewable energy at its South American operations.

The MetalMiner Best Practice Library offers a wealth of knowledge and tips to help buyers stay on top of metals markets and buying strategies.

Century Aluminum reaches labor deal with USW for Hawesville smelter

Aluminum production

Alexander Chudaev/Adobe Stock

Century Aluminum announced it had reached an agreement with the United Steelworkers union at its Hawesville smelter.

The company said it had reached a five-year deal with United Steelworkers Local 9423.

The new contract will run through April 1, 2026. Furthermore, the company said it will add about 60 news jobs at the smelter.

“These productive negotiations between the two parties is a great example of how we work together with the USW to provide the best opportunities for our employees and to put Hawesville in a position to succeed in a highly competitive aluminum market,” said Gunnar Gudlaugsson, Century’s executive vice president of global operations, and Dayan Neves, Hawesville’s plant manager.

Ford of Europe releases Q1 sales figures

Ford of Europe reported its Q1 sales rose by 7.7% from Q1 2020. Furthermore, March sales surged by 70.6% from March 2020.

The UK, Germany and Italy took the top three spots in Q1 in terms of Ford sales.

Anglo American touts renewable South American operations

Following through on previous commitments, Anglo American said it has made the transition to 100% renewable energy at its South American operations.

“Having already secured renewable energy to meet all its power requirements for its iron ore and nickel operations in Brazil from 2022, and for its copper operations in Chile from 2021, Anglo American has now signed an agreement with Engie Energía Perú to provide 100% renewable energy for the Quellaveco copper operation in Peru that is expected to begin production in 2022,” the miner said in a release.

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Before we head into the weekend, let’s take a look back at the week that was and the metals storylines here on MetalMiner, including coverage of steel prices, US electricity consumption and much more:

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Week of April 12-16 (steel prices, electricity consumption and more)

The MetalMiner Best Practice Library offers a wealth of knowledge and tips to help buyers stay on top of metals markets and buying strategies.

This morning in metals news: Alcoa announced its first quarter financial results; US housing starts surged in March; and General Motors and LG Energy Solution are building a second Ultium battery cell manufacturing plant in the US.

The MetalMiner Best Practice Library offers a wealth of knowledge and tips to help buyers stay on top of metals markets and buying strategies.

Alcoa releases first quarter financial results

earnings sign

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Alcoa released its first quarter financial results Thursday, in which it posted strong numbers boosted by higher aluminum and alumina prices.

The firm reported net income of $175 million in the first quarter of 2021. That compares with income of $80 million in Q1 2020. Meanwhile, Alcoa reported a net loss of $4 million in Q4 2020.

“We had an excellent first quarter with our best quarterly result since a record-setting year in 2018,” Alcoa President and CEO Roy Harvey said. “We excelled from the top line to the bottom line, controlling production costs and capturing the benefits of improved demand and stronger prices for alumina and aluminum.”

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The Raw Steels Monthly Metals Index (MMI) rose by 7.8% for this month’s reading, as steel prices continued to rise.

April 2021 Raw Steels MMI chart

Are you prepared for your annual steel contract negotiations? Be sure to check out our five best practices.

Steel price gains slow

As we’ve chronicled in this monthly column, steel prices have been rising consistently since last summer.

Buyers have struggled to find supply in what eventually became an allocation market.

Steel prices have posted double-digit percentage gains on a month-over-month basis. However, that ascent appears to be slowing somewhat.

The US hot rolled coil price, for example, continued to increase. The US HRC three-month price rose 20% month over month to $1,280 per short ton. However, the price has flattened out thus far in April.

Are steel prices finally reaching a peak? That is not yet clear, but price gains have certainly started to slow.

Supply developments

Speaking of allocation markets and tight supply, buyers will take some solace in the fact that some new supply will be coming on stream, both in the short and medium terms.

Work continues on Steel Dynamics’ new Sinton, Texas facility, which is scheduled to open by mid-year.

Excluding costs associated with investment in the Sinton flat rolled steel mill ($18 million), the company said it expected its first quarter earnings to be in the range of between $1.94 and $1.98 per diluted share, which it said could represent a record earnings quarter for the company.

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mining

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This morning in metals news: miner Rio Tinto announced it had reached a financing plan with Turquoise Hill Resources for the Oyu Tolgoi copper mine in Mongolia; meanwhile, the United States International Trade Commission (USITC) made a countervailing duty ruling on chassis and subassemblies from China; and, lastly, China’s National Bureau of Statistics released Producer Price Index (PPI) figures for the industrial sector in March.

The MetalMiner Best Practice Library offers a wealth of knowledge and tips to help buyers stay on top of metals markets and buying strategies.

Rio Tinto reaches financing deal for Oyu Tolgoi

Miner Rio Tinto announced it had reached a financing deal with Turquoise Hill Resources for the Oyu Tolgoi copper miner project.

The massive underground copper-gold mine project is a partnership between the Mongolian government and Turquoise Hill Resources. Rio Tinto has a majority stake in Turquoise Hill. Meanwhile, the Mongolian government owns 34% of the project, while Turquoise Hill owns the balance.

However, the Mongolian government had earlier this year expressed reservations about the progress of the project.

A few months later, Rio Tinto says it has an updated funding plan for the mine.

The estimated remaining funding needed for the project is approximately $2.3 billion.

USITC rules on chassis, subassemblies from China

The USITC this week ruled imports of chassis and subassemblies from China are being subsidized by the exporter.

As a result, the Department of Commerce will issue a countervailing duty order.

NBS: PPI for manufactured goods up 4.4%

China’s National Bureau of Statistics reported the Produce Price Index (PPI) for manufactured goods rose by 4.4% year over year in March.

The PPI rose 1.6% month over month.

The PPI for non-ferrous metal materials and wires jumped by 17.3%. Meanwhile, the ferrous metal materials index rose by 15.6%.

Find more insight on MetalMiner’s LinkedIn.

The Aluminum Monthly Metals Index (MMI) ticked up 2.0% for this month’s reading, as aluminum premiums remain elevated.

April 2021 Aluminum MMI chart

Does your company have an aluminum buying strategy based on current aluminum price trends?

Rising physical delivery aluminum premiums

For aluminum buyers vying for material, they’re finding physical delivery premiums are elevated.

In fact, rising premiums are a sign of market tightness, MetalMiner’s Stuart Burns explained this month. Furthermore, premiums are up in both the US and Europe.

Among the reasons for the rise, China’s shift to net importer has led to the country sucking up a large share of available supply.

“The resulting arbitrage has sucked in imports of both pure and alloy ingot,” Burns wrote. “China imported nearly a quarter of a million tons of primary and over 140,000 tons of alloy metal in just the first two months of this year. That brought its cumulative net totals to 1.3 million tons of primary and 1.1 million tons of alloy since the start of 2020.

“Imports like that, much on spot markets or via traders, has sucked exchange traded and shadow market metal east, placing it conveniently for short onward shipment to China.

“As a result, there is less metal available in warehouses in Europe and the US.”

The Midwest Premium reached $0.22 per pound this week. In January, the premium had fallen as low as $0.12 per pound.

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