Articles in Category: Ferrous Metals

This morning in metals news: U.S. steel capacity utilization dropped slightly last week; the number of drilled but uncompleted oil wells in the U.S. declined in July; and, lastly, the construction sector shed 3,000 jobs in August.

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Steel capacity utilization hits 84.5%

hot rolled steel

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The U.S. steel capacity utilization rate for the week ending Sept. 4 fell to 84.5%, the American Iron and Steel Institute (AISI) reported this week.

The rate marked a decline from 84.9% the previous week.

Meanwhile, steel output last week totaled 1,866,000 net tons, AISI reported. The total marked a 0.4% decline from the previous week but a 23.5% year-over-year rise.

DUCs decline in July

Meanwhile, in energy news, the Energy Information Administration (EIA) reported drilled but uncompleted (DUC) wells in the U.S. fell to their lowest monthly level in July since November 2017.

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One of India’s foremost steel companies, Jindal Steel & Power Ltd., has announced plans to invest U.S. $2.4 billion to increase capacity over the next six years as recovery from the COVID-19 pandemic boosts steel demand.

“Domestic steel prices have recovered from the lows of the COVID-induced volatility and are increasing spurred by improving demand prospects,” the firm said in its August investor presentation.

Volatility is the name of the game. Do you have a steel buying strategy that can handle the ups and downs?

Jindal Steel to ramp up capacity

India

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The steelmaker will increase its total capacity to 15.9 million tons (MT) by March 2025 from 8.6 MT, it said in an investor presentation recently. According to the statement, the company plans to more than double pellet production capacity to 21 million tons by 2024.

On Monday, in a statement to the stock exchanges, the steel company announced that its board had approved fundraising measures that include issuing non-convertible, senior, unsecured, fixed rate or LIBOR notes worth U.S. $1 billion.

JSPL’s plan includes raising money as part of its long-term goal of becoming debt-free and increasing production capacity to 15.9 MT by FY 2024.

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This morning in metals news: U.S. steel capacity utilization dipped to 84.9% last week; North American Stainless said it is maintaining fuel surcharge; and, lastly, RUSAL earlier this month reported its interim H1 2021 results.

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Steel capacity utilization dips to 84.9%

steelmaking in an EAF

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U.S. steel capacity utilization dipped to 84.9% for the week ending Aug. 28, the American Iron and Steel Institute reported.

Steel output during the week reached 1.87 million net tons. That weekly total marked a decline of 0.2% from the previous week. However, output increased by 26.9% on a year-over-year basis.

For the year to date, steel production reached 62.0 million net tons. Capacity utilization during that period reached 80.5%. During the same period in 2020, the rate reached just 66.6%, with output at 51.7 million net tons.

NAS updates fuel surcharge

North American Stainless (NAS) today said it will maintain its fuel surcharge of 27% for stainless flat and long products.

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Higher stock levels and summer holidays have seen prices for hot rolled coil in Western Europe move off since late July, industry watchers said.

“I have the impression that people are not fully back yet from their holidays,” one source said.

Those who have returned are now either taking a wait-and-see approach to any new buying or are purchasing only small amounts, the source added.

Volatility is the name of the game. Do you have a steel buying strategy that can handle the ups and downs?

Hot rolled coil slides in Western Europe

hot-rolled coil steel

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Offers on hot rolled coil prices produced in Western Europe are now about €1,150 ($1,350) per metric ton exw for December delivery. That marked a drop of 4.2% from the €1,200 ($1,410) in July.

Prices for cold rolled coil, a downstream product of hot rolled coil, normally carry a premium of €100-120 ($120-140) per metric ton.

Import offers on hot rolled coil from the Far East are now about €1,000 ($1,175) per ton cfr European ports, sources also said.

Another trader reported he had heard of offers from South Korea at €960 ($1,130) per metric ton cfr Antwerp.

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As has been well documented by now, demand for a wide variety of materials plunged on the heels of the onset of the COVID-19 pandemic last year.

E.U. flag

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Among those materials, of course, is steel.  Consumer demand for steel-using products declined and construction projects came to a halt.

However, data from the European Steel Association show demand picking back up among EU28 nations this year.

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EU steel demand shows signs of recovery

Earlier this month, the European Steel Association (EUROFER) said apparent steel consumption in the EU28 rose by 3.6% in Q4 2020. In Q1 2021, apparent steel consumption rose by 0.9%.

“Although the general economic recovery in the EU appears to be uneven and exposed to risks, the recovery in steel-using industries and in steel demand should continue through 2021,”EUORFER Director General Axel Eggert said. “This is being driven by the stronger-than-expected recovery of industrial sectors, whose output is recovering the losses experienced during the pandemic.”

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Global crude steel production fell month over month for the second straight month in July, the World Steel Association reported this week.

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Global crude steel production drops

China steel production

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Global crude steel production totaled 161.7 million metric tons in July, the World Steel Association reported.

The total marked a decline from 168 million metric tons in June. Furthermore, production totaled 175 million metric tons in May.

Meanwhile, July production jumped 3.3% on a year-over-year basis.

Chinese steel production curbs take hold

Beijing’s efforts to curb steel production might not have been particularly successful during the first half of the year, as Chinese steel production surged. Chinese steel production from January through June totaled 563.3 million tons, or up 11.8% year over year.

However, the country’s steel output has declined in each of the last two months.

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U.S. steel imports totaled 2.7 million metric tons in July, the Census Bureau reported this week.

The total marked an increase from 2.6 million metric tons in June.

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US steel imports paced by blooms, billets and slabs

steel made in an EAF

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The July rise in imports came largely on the back of a jump in imports of blooms, billets and slabs.

Imports for that category totaled 860,790 tons, up 8.2% from 795,863 tons in June.

Meanwhile, imports of hot dipped galvanized sheets and strips totaled 228,981 tons in July, up from 177,925 tons the previous month.

Imports of oil country goods rose to 160,025 tons from 154,073 tons the previous month.

Rebar, hot rolled sheet imports decline

However, imports of reinforcing bars fell to 82,623 tons from 94,915 tons the previous month.

Hot rolled sheet imports totaled 282,605 tons in July, down from 311,461 tons the previous month.

Wire rod imports fell to 101,746 tons from 113,408 tons in June.

North of the border

By country, imports from Canada increased to 594,500 from tons in July from 579,405 tons the previous month.

Meanwhile, imports from Mexico fell 7.9% month over month to 349,343 tons.

Imports from Russia surged by 30.5% to 210,540 tons.

Elsewhere, imports from Japan plunged to 60,924 tons in July from 126,982 tons in June. Korean imports jumped to 265,573 tons from 248,582 tons the previous month.

In addition, imports from Brazil surged by 34.8% month over month to 413,306 tons in July.

Steel Dynamics eyes Q4 for new flat rolled mill

Steel buyers continue to face myriad challenges, from market tightness to logistics issues.

Global steel production declined for the second straight month on a month-over-month basis in July, the World Steel Association reported this week.

Global steel production totaled 161.7 million tons in July, down from 168 million tons the previous month. Meanwhile, May production totaled 175 million tons.

Furthermore, Beijing’s efforts to curb steel production appear to be taking hold. China’s steel production also declined for a second straight month, totaling 86.8 million tons in July (down from 93.9 million tons in June.

In the U.S., buyers are vying for limited supply, whether domestically or in the form of steel imports, amid an unprecedented ascent of steel prices over the last year.

Some relief is coming in the form of Steel Dynamics, Inc.’s (SDI) new electric arc furnace (EAF) flat rolled mill in Sinton, Texas. In its Q2 investor report, the steelmaker said it plans to start production at the mill in mid-Q4 2021. The company estimated an investment price tag of $1.9 billion for the new mill.

SDI estimates the mill will add 3 million tons in annual production, bringing its total annual capacity to nearly 14 million tons.

Cut-to-length adders. Width and gauge adders. Coatings. Feel confident in knowing what you should be paying for metal with MetalMiner should-cost models.

This morning in metals news: U.S. steel imports are up by 17.4% in the year to date, the American Iron and Steel Institute reported; meanwhile, Toyota Motor is imposing its biggest price hike on steel materials in over a decade, according to Nikkei Asia; and, lastly, the WTI crude oil price has ticked up this week.

Cut-to-length adders. Width and gauge adders. Coatings. Feel confident in knowing what you should be paying for metal with MetalMiner should-cost models.

US steel imports up 17.4%

imports

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US steel imports jumped by 17.4% through the first seven months of the year, the American Iron and Steel Institute reported.

The U.S. imported a total of 3.0 million net tons of steel in July 2021, up 2.8% from June, AISI reported, citing Census Bureau data.

Meanwhile, through the first seven months of 2021, steel imports totaled 17.7 million net tons, or up 17.4% year over year.

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U.S. steel capacity utilization picked back up to 85.0% for the week ending Aug. 21, the American Iron and Steel Institute (AISI) reported.

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Steel capacity rises

hot rolled steel

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U.S. steel capacity utilization rose to 85.0% from 84.7% the previous week. Steel output reached 1,877,000 net tons last week, up 0.4% from the previous week.

Meanwhile, steel output for the week ending Aug. 21 increased by 27.2% from the same week in 2020, when the capacity utilization rate reached 65.9%.

For the year to date, U.S. steel production totaled 60,173,000 net tons, at a capacity utilization rate of 80.4%. The year-to-date production total increased by 19.8% from 2020, when the rate reached 66.6% for the equivalent period.

Steel prices continue to gain

U.S. steel prices have embarked on an essentially uninterrupted rise over the last year.

While recent month-over-month gains are not hitting the double-digit marks we’ve seen over the last year, prices are still moving upward.

U.S. hot rolled coil closed Monday at $1,883 per short ton, or up 3.98% month over month. Meanwhile, U.S. cold-rolled coil closed at $2,088 per short ton, or up 4.56%.

Meanwhile, hot dipped galvanized rose by 2.97% to $2,184 per short ton.

Nucor acquires steel rack solutions provider for $370M

In steel sector M&A news, Nucor Corporation on Monday announced it had acquired Hannibal Industries, Inc., for a cash price of $370 million.

“We are excited to officially welcome our Hannibal teammates as part of the Nucor team,” said Giff Daughtridge, president of Nucor’s sheet and tubular products division. “Adding steel racking solutions to our product portfolio expands our ability to serve our customers in the fast-growing warehouse and distribution market. This acquisition complements our existing product capabilities in this area.”

Hannibal Industries, Inc., is headquartered in Los Angeles and produces 150,000 tons of steel products annually, according to information on its website.

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.

This morning in metals news: two Chinese steelmakers are merging to form the world’s third-largest steelmaker; the LME aluminum price lost some ground last week; and, lastly, July construction employment continued to lag in the U.S.

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

Major Chinese steelmakers merge

China map

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Two Chinese steelmakers are merging to form the world’s third-largest steelmaking company, state-run news outlet Xinhua reported Friday.

Ansteel and Ben Gang Group Corporation signed a merger deal Friday, Xinhua reported.

Ansteel will have annual production capacity of 63 million metric tons after the merger. Furthermore, the firm is targeting capacity of 70 million metric tons of crude steel by 2025.

Aluminum price dips

Meanwhile, aluminum prices remain elevated, but they took a step back last week.

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