Articles in Category: Commodities

Suez Canal

MenaraGrafis/Adobe Stock

Before we head into the weekend, let’s take a look back at the week that was and some of the metals storylines here on MetalMiner, including the Suez Canal blockage, the April 2021 MMO, Western European hot rolled coil prices and much more:

Sign up today for Gunpowder, MetalMiner’s free, biweekly e-newsletter featuring news, analysis and more.

Week of March 29-April 2 (Suez Canal retrospective, HRC in Western Europe, April MMO report and more)

Stay up to date on MetalMiner with weekly updates – without the sales pitch. 

steel tubes

Maksym Yemelyanov/Adobe Stock

This morning in metals news: Nucor Corporation announced plans to build a new tube mill in Kentucky; meanwhile, US retail gasoline prices have been on the rise; and, lastly, unemployment rates in February fell in 23 states.

You want more MetalMiner on your terms. Sign up for weekly email updates.

Nucor to build new tube mill

Nucor recently announced plans to build a new tube mill in Kentucky near its Gallatin sheet mill.

The steelmaker said it will invest $164 million into the project, which will be operational in 2023.

“The new tube mill will have the capacity to produce approximately 250,000 tons of hollow structural section (HSS) steel tubing, mechanical steel tubing and galvanized solar torque tube,” Nucor said. “The Kentucky location puts the new tube mill near expanding solar markets in the U.S. and the largest consuming regions for HSS steel tubing.”

Retail gas prices on the rise

To the chagrin of motorists heading to the pump, retail gas prices have continued to rise.

US retail gasoline prices averaged $2.85 per gallon as of Monday, the Energy Information Administration reported.

Read more

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 the semiconductor shortage, the Midwest Premium and more.

A fire at a Japanese chip-making plant last week has slammed automotive operations. General Motors, Ford and many other automakers have announced idling of production as a result of the shortage.

Meanwhile, on the supply side, Intel announced plans to invest $20 billion to build two new Arizona plants. Furthermore, Intel said it aims to “serve the incredible global demand for semiconductor manufacturing.”

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

Week of March 22-26 (semiconductor shortage, Midwest Premium and more)

semiconductor and automobile

Maxim_Kazmin/Adobe Stock

Stay up to date on MetalMiner with weekly updates – without the sales pitch. Sign up now.

Tangshan steel plant

junrong/Adobe Stock

The recent curbs on steel making by the local government in one of China’s largest steel-producing cities, Tangshan, may have a cascading effect on steel procurement & demand, as well on iron ore supplies, some experts believe.

The Tangshan restrictions are in effect from March 20 to Dec. 31, 2021. Among other things, the restrictions penalize steel mills there that fail to meet emission control regulations.

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

Tangshan part of countrywide effort

The curbs are in line with China’s fresh efforts to cut emissions meet carbon-neutrality targets. China aims to reach carbon neutrality by 2060.

Already, iron ore prices felt effects from the restrictions. Meanwhile, the long-term effect on the import-export of steel from China remains to be seen.

Daily iron ore consumption in Tangshan is also likely to drop drastically. The restrictions had led to the drop in iron ore futures but boosted hot-rolled coil (HRC) futures.

Read more

nickel price

leszekglasner/Adobe Stock

Before we head into the weekend, let’s take a look back at the week that was and some of the metals storylines of the week here on MetalMiner, including coverage of the nickel price, oil prices, housing starts and more.

Overall, steel prices continue to rise. Meanwhile, after experiencing significant price declines, lead and nickel have steadied of late. Aluminum continues to be on an upward trajectory, while copper has steadied after dropping from a Feb. 25 peak.

The MetalMiner team will be presenting a commodity forecast for copper, aluminum, stainless and carbon steel on Wednesday, March 24, at 10 a.m. CDT: https://zoom.us/webinar/register/WN_6J8wAyYySfihVk3ZUH9yMA

Week of March 15-19 (nickel price steadies, Honda announces temporary production suspension and more)

Sign up today for Gunpowder, MetalMiner’s free, biweekly e-newsletter featuring news, analysis and more.

iron ore stockpile

John/Adobe Stock

Seaborne iron ore prices hit a 10-year high this month at $178 per ton before profit taking. Investors bet on strong steel demand and robust consumption in top consumer China.

Don’t miss the MetalMiner analyst team on March 24 at 10 a.m. CDT for a 30-minute metals market forecast and strategies to deploy in falling markets: https://zoom.us/webinar/register/WN_6J8wAyYySfihVk3ZUH9yMA.

Iron ore price and pollution in China

But following the release of details in China’s new Five-Year Plan calling for wide-ranging and ambitious targets to reduce environmental pollution, iron ore prices experienced a sharp sell-off. Investors took profits at the prospect that steel production could be restricted by Beijing in an effort to reduce pollution.

Steelmaking is a major source of pollution in China. The steelmaking process is estimated to account for about 15% of the country’s total emissions.

So it is hardly surprising investors took profits at the prospect of the steel industry potentially facing significant environmental controls and increased efforts by Beijing to close excess steel production.

EAF acceleration

What the Five-Year Plan may well accelerate is adoption of electric arc furnace (EAF) steelmaking as blast furnace operators switch to scrap consumption to reduce pollution.

EAFs are a significantly less polluting production method than traditional blast furnaces. However, that is only the case if the electric energy source is not totally from coal. Unfortunately, much of China’s still is.

Still, if pollution is measured at the point of production rather than mine to finished product, EAF will be a winner.

Beijing has already reclassified and eased steel scrap imports late last year, possibly with an eye on encouraging adoption of such less-polluting technologies.

Higher-purity iron ore

There will likely also be greater use of high-purity iron ore and pellets, with Fe purity percentages in the mid- and upper-60s. Both offer a route for blast furnace operators to reduce their pollution levels. For more modern, efficient mills they can mitigate penalties or meet threshold targets.

The premium for high-grade iron ore is already a record above low-purity material. This is in part because supply sources are limited. Those with the highest purity resources are charging a premium. One reason why imported iron ore volumes are so high — domestic production is generally of low Fe purity material, which consumers have shunned more and more.

Peak iron ore price?

For the time being, mills are making good money and can afford the cost.

However, if steel demand were to drop this year, iron ore prices could see further falls.

As such, have we reached peak iron ore?

The short answer? Maybe. Much will depend on how enthusiastically (and how quickly) Beijing and state governments apply the edicts of the new Five-Year Plan. In addition, it will depend on how quickly last year’s stimulus measures begin to lose their impact on the economy.

China’s bounce-back has been impressive. Beijing, however, is doing a lot behind the scenes to slow the growth of debt and give the property market a gentle landing.

For the first time in decades, the US could have a higher rate of growth this year than China.

But the US is not a market for seaborne iron ore, so China remains the principal driver of price direction.

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

crude oil

phonlamaiphoto/Adobe Stock

Oil prices have been on the rise for months and, according to the Energy Information Administration (EIA), they appear likely to remain elevated in April.

“The sustained OPEC+ production curtailment through April suggests that supply will remain constrained in the near term, even as demand continues to increase,” the EIA explained Wednesday.

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

Short-term oil price gains

In its March Short-Term Energy Outlook (STEO), the EIA reported it expects Brent crude will average $64 per barrel in Q2 2021. Then, it forecasts a fall to less than $60 per barrel through the end of 2022.

“Higher crude oil prices in March and April are primarily a result of lower crude oil production from members of the Organization of the Petroleum Exporting Countries (OPEC) and partner countries (OPEC+), as announced at their March 4 meeting.,” the EIA reported.

Last week, Stuart Burns weighed in on the oil price and its potential trajectory.

“Demand, however, remains subject to economic recovery,” he wrote. “The market would take any significant increase in output negatively, some analysts suggest. That could result in a sell-off.

“Recent price strength notwithstanding, the market still looks somewhat fragile. That condition no doubt explains the Saudis’ reluctance to increase output.

“Meanwhile, pressure will build with many producers at or around budgetary break-even at current levels.

“The next crunch point is the April OPEC meeting. The market is watching.”

On Tuesday, the OPEC daily basket price — a weighted average of 13 crudes — stood at $66.89 per barrel. The basket price opened the year at $59.60 per barrel. Meanwhile, the basket price had plunged as low as $17.66 per barrel in April 2020.

Read more

ArcelorMittal sign in Ontario

JHVEPhoto/Adobe Stock

Before we head into the weekend, let’s take a look back at the week that was and some of the metals coverage here on MetalMiner, including coverage of ArcelorMittal, copper prices, China’s latest five-year plan and much more:

Week of March 8-12 (ArcelorMittal, China’s Five-Year Plan and more)

Brent crude oil price chart

SodelVladyslav/Adobe Stock

This time last year, Saudi Arabia all but announced war on America’s fracking industry and major OPEC+ partner Russia by releasing a flood of oil onto the world market just as the pandemic was getting underway.

The pandemic, among other impacts, led to a plunge in oil demand. The unprecedented collapse in prices took oil prices down to an 18-year low.

Don’t miss the MetalMiner analyst team on March 24 at 10 a.m. CDT for a 30-minute metals market forecast and strategies to deploy in falling markets: https://zoom.us/webinar/register/WN_6J8wAyYySfihVk3ZUH9yMA.

Oil price plunge and rise

Reality set in as revenues collapsed.

Within months, led by Saudi Arabia, the OPEC+ group agreed to production cutbacks of some 10 million barrels a day. The move kickstarted what has since been a sustained price recovery despite still weak demand.

Since then, output has been allowed to rise. However, some 7 million barrels per day of cutbacks remains in place. Earlier this month, OPEC agreed on only a modest increase of 130,000 barrels  per day for Russia and 20,000 per day for Kazakhstan. The rest of the group would forgo the planned 1 million barrel per day increase previously planned from April, the Financial Times reported.

Oil price support

Two further factors have supported prices this month.

Read more

stack of steel pipes

kasarp/Adobe Stock

This morning in metals news: Nucor announced plans to build a new tube mill in the Midwest; meanwhile, the Bureau of Labor Statistics released the Consumer Price Index summary for February; and the oil price pulled back slightly this week.

Don’t miss the MetalMiner analyst team on Wednesday, March 24, at 10 a.m. CDT for a 30-minute metals market forecast and strategies to deploy in falling markets: https://zoom.us/webinar/register/WN_6J8wAyYySfihVk3ZUH9yMA.

Nucor to build new tube mill

Nucor Corporation said Tuesday its Board of Directors had approved a plan to build a new tube mill in the Midwest.

“Products from the new tube mill will capitalize on investments Nucor has already made in the Midwest including a plate mill, galvanizing line and hot roll expansion,” Nucor said. “The new tube mill is a continuation of Nucor’s focus on growth and commitment to sustainability and environmental stewardship.”

The steelmaker plans to invest $164 million in the new mill, which it says will come online in two years.

BLS releases Consumer Price Index summary

The Bureau of Labor Statistics released the Consumer Price Index summary for February, reporting the CPI For Urban Customers rose by 0.4%.

The all items index rose by 1.7% over the last year.

Read more

1 2 3 4 5 446