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Aluminum Prices

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Carbon Steel Prices

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Nickel Alloy Prices

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Stainless Steel Prices

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Titanium Prices

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Articles on: Metal Prices

Tomasz Zajda/Adobe Stock

This morning in metals, U.S. Steel announced a large investment at its flagship steel plant, the U.S. and China will resume talks on trade, and copper is set to finish the week with its biggest weekly loss since early July.

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U.S. Steel Announces $750M Investment

U.S. Steel announced it plans to invest $750 million in its flagship plant in Gary, Indiana, the Chicago Tribune reported Thursday.

According to the report, the firm credited the Trump administration’s trade policies in helping to facilitate the company’s modernization of its plants, while President and CEO David Burritt said the company is experiencing a “renaissance.”

U.S., China to Restart Trade Talks

Trade tensions between the U.S. and China have continued to grow, as the U.S. has in recent weeks imposed a total of $50 billion in tariffs ($16 billion of which will go into effect Aug. 23), with China responding in kind.

According to several reports, officials from the two countries plan to meet later this month to talk trade in hopes of deescalating the situation.

Copper Slides Again

It has been a tough couple of months for copper, which continued its slide this week, posting its biggest weekly loss since early July, Reuters reported.

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According to the report, the LME copper price fell 4.5% this week.

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The breaking news this week is that Chile’s Escondida mine operator BHP has announced it looks like a strike has been averted and that a settlement plan is being put to the workers.

That is good news for a market widely expected to go into deficit this year, according to Mining.com.

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But the prospect of a strike was all that was holding up the copper price, which promptly fell 5% on the news, touching a low of $2.55 a pound ($5,622 a metric ton) in New York and down more than 20% from a nearly four-year high struck a little over two months ago, according to Mining.com.

Production in the world’s largest copper producer, Chile, has been plagued this year by a number of issues (in addition to BHP’s problems).

Competitor Antofagasta announced this week a disappointing set of first-half results. The miner reported production was down 8.5% in the first six months of the year compared to last, due to poor ore grades and infrastructure issues at its biggest mine. Revenue rose on higher prices earlier in the year, but profitability still fell 32%.

The copper price has taken a beating recently on widespread fears about global trade and political turmoil in places like Turkey, but a recent S&P Global report paints a rosy picture for producers regarding future prices, saying new discoveries are falling way below historical standards.

Producers have increasingly focused on developing their existing resources, the report states. This may be due to lack of faith in future prices — the end of the super cycle, or a more cautious post-financial-crash investment climate.

Chinese growth is slowing and producers are more inclined to maximize existing resources than bet the farm on new exploration and invest in new greenfield projects.

S&P reports Latin America hosts over half of copper discovered. Chile and Peru alone account for 83% of copper discovered in Latin America and 46% of the global total found since 1990. Of the 139.9 Mt of copper contained in the 29 discoveries made over the past 10 years, almost two-thirds is contained in the four largest deposits, S&P reports, illustrating the somewhat precarious nature of the copper supply market.

The pool of projects likely to come to market over the next decade is limited by the low level of investment and the long, up to 20-year lead in from discovery to production.

Although prices are currently under pressure from trade fears and a strong dollar, global demand has held up well so far, in the region of 2-3% annually.

Not surprisingly, miners are flagging up supply risks as a bigger issue for the copper market than lack of demand.

In the medium term, they are probably right. Despite all the noise about trade fears and tariffs, the reality is global growth and metals demand has remained robust. Contemporary developments are likely to trump medium-term supply risks in the minds of investors. As such, prices are going to remain subdued this year — if not bearish, then at least trading sideways.

MetalMiner’s Annual Outlook provides 2018 buying strategies for carbon steel

How we go next year, though, is another matter.

If trade issues can be even partially resolved and some degree of confidence restored, prices could recover; but, for the time being, it is buy as needed.

The August Monthly Metal Index (MMI) report is in the books.

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This month saw all 10 of our MMI subindexes posting declines. U.S. steel prices continue to hover around seven-year highs, but the rest of the metals complex (more or less) has been down of late.

Here are a few highlights from this month’s round of MMI reports:

  • U.S. auto sales were down for many major automakers last month, but Fiat Chrysler saw its sales grow 6% year over year.
  • U.S. construction spending dropped 1.1% in June from the previous month.
  • U.S. steel prices continue to be at seven-year highs, but price momentum slowed last month and many forms of steel are trading sideways.
  • Copper prices have been sliding for the past couple of months, but a labor standoff at BHP Billiton’s Escondida mine in Chile could offer price support (if the union at the mine ultimately goes on strike).

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Read about all of the above and much more by downloading the August 2018 MMI Report below:

The spike in aluminum prices this quarter, caused by the initial announcement of sanctions on Oleg Deripaska and his investments, is an issue anyone in the aluminum sector will be only too well aware of.

Buying Aluminum in 2018? Download MetalMiner’s free annual price outlook

Prices spiked in days and were associated with a number of other supply constraint worries. Sharp rises in conversion premiums have not relaxed even though the primary aluminum price has since eased back to where it was just before the announcement.

The price increase and supply-chain panic was a result of the sanctions announced by the Office for Foreign Assets Control (OFAC). Prices fell back as OFAC granted a stay of application until late October 2018, allowing consumers to adjust supply agreements accordingly.

Source: Bloomberg

While the market is aware first-hand of the impact, what is only just becoming clear is the impact on the main supplier from Deripaska’s group: Rusal.

According to the Financial Times, drawing on the most recent Q2 company filing, inventories had risen to $2.88 billion at end the of June, from $2.41 billion in December as the company produced 939,000 metric tons of primary aluminum and alloys in the three months to June, but only sold 783,000 tons. Both first-half 2018 production and sales are down from a year earlier, largely due to the Q2 sanctions, even though the company continues to operate profitably.

Although Rusal is looking to boost output of value-added goods (VAGs), as they call processed products, they sharply cut back production of foil, powders and other VAG products in April for fear of not being able to shift production if sanctions were sustained.

As it happens, most global consumers restarted deliveries after a few weeks, but many in the U.S. are still reluctant to touch Rusal product – primary or VAGs – as the October crunch date looms.

Source: Bloomberg

2019 annual contracts are usually negotiated in September, ahead of the October LME week, and in preparation for supplies starting in January of the following year. Unless there is certainty that the OFAC sanctions will be lifted or some form of exemption will be granted to Rusal despite what happens to Deripaska, Rusal will again face restricted sales options going forward.

The case against Deripaska is already severely impacting any trade with entities in which he or his holding company En+ Group have a stake, as banks carry out exhaustive checks on every payment, causing delays of weeks on some transactions.

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Those consumers with other supply options will conclude it is just not worth the effort and switch to alternative sources, further crimping capacity availability in the market and pushing up conversion premiums even, if the primary metal price has yet to respond.

The headline news for grain-oriented electrical steel (GOES) involves the continued drop in total import levels into the U.S.

The U.S. had imported at least 2,500 metric tons per month since the start of this year, but after the announcement of tariffs, imports shrank to 411 metric tons in July.

However, some steel pundits speculate imports will begin to notch up, particularly for the wider steel market.

While total U.S. import volumes fell in July, Japan still held 59% of total import volume, up 1% from June’s import levels.

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In the meantime, companies continue to file exclusion requests.

Interestingly, only three companies have filed the bulk of exclusion requests for grain-oriented electrical steel and no firm received an approved exemption.

The only exclusions within the broader GOES HTS codes includes Nachi America Incorporated for hot-rolled M2 high speed steel sheet on the basis of insufficient domestic capacity.

Meanwhile, Electrical Mechanical Corporation filed approximately 34 exclusion requests for GOES M6 and M4, arguing that longer lead times from the sole domestic supplier, AK Steel (2-3 times longer) have led to increased manufacturing costs, delayed shipments and a weaker competitive position in the market.

So far, companies have filed nearly 25,000 exclusion requests and MetalMiner is aware of some companies obtaining exemptions — approximately 1,400-plus exemptions have been granted — but none have been for GOES.

AK Still Looking for Import Relief

In AK Steel’s most recent earnings report, on a trade update slide the company pointed to not only GOES products but also stated that it is, “Critical that downstream electrical steel products be adequately addressed.”

Next month, MetalMiner will address 301 exemptions, which also include GOES.

Exact GOES Coil Price This Month

The U.S. grain-oriented electrical steel (GOES) coil price fell from $2,914/mt to $2,857/mt. The GOES Monthly Metals Index (MMI) fell four points from 211 to 207.

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The GOES MMI® collects and weights 1 global grain-oriented electrical steel price point to provide a unique view into price trends over a 30-day period. For more information on the GOES MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.

Last month we noted that record-low prices characterized the Global Precious Monthly Metals Index (MMI) monthly reading and posed the question: will there be more price drops to come?

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From the looks of it, the short answer to that is … yes.

Here’s What Happened

Going by the August 2018 reading of MetalMiner’s Global Precious MMI, which tracks a basket of precious metals from across the globe, the subindex suffered a loss of 2.4%, falling to a value of 82.

The last time we saw the Global Precious MMI at that level was February 2017.

Platinum and palladium seemed to drive the loss this month, yet all major forms of precious metals across geographies ended up lower this month.

For example, the U.S. platinum bar price dropped 1.8% to $837 per ounce. Palladium is still transacting at a premium to platinum in the U.S. market, but not in the China or Japan markets (although exchange rates may ultimately be affecting that relationship). The U.S. palladium bar price dropped for August as well, down 2.1% to $928 per ounce.

Yet the U.S. silver price ended up lower than $16 per ounce to begin the month for the first time since January 2017, clocking in at $15.50 on Aug. 1. The gold price dropped as well, with U.S. gold bullion taking a 2.3% hit to end up at $1,223.40 per ounce.

All of these metals appear to be in a long-term downtrend since the tail end of 2017 and first couple months of 2018.

What Buyers Should Consider

  • A strong dollar still keeping the platinum price low. Along with supply surplus and the ever-looming threat of a global trade war, the dollar’s strength is a strong indicator of platinum’s fortunes for the rest of 2018. A recent Reuters poll of 29 analysts and traders showed that the platinum price looks to remain historically depressed for the balance of the year, with a slight rebound in 2019. “The diesel scandal remains a drag on demand … Meanwhile, currency weakness provides a lifeline to the South African platinum industry, cutting dollar-denominated costs and reducing the risk of mine closures,” said Carsten Menke, analyst for Julius Baer, as quoted by Reuters.
  • Palladium to remain at a premium? “We expect a rebound in palladium prices [in 2019] amid a growing market share of gasoline vehicles and healthy demand growth in emerging markets. Fundamentals are tight amid a widening deficit,” Intesa Sanpaolo analyst Daniela Corsini told Reuters.
  • Your latest preferred supplier — Sears? In the current economic climate that retailer finds itself in, it’s strange to hear that the company has added several brand lines sold by third-party sellers to “bolster its online marketplace,” according to a press release. Additions include “gold, silver, platinum and palladium bars, rounds and coins, as well as premium bullion products,” the release stated. So if you’re looking outside the box to source your precious metal volumes for industrial applications, take note: “Sears.com and Shop Your Way® are currently offering a $20 CASHBACK in Points when members spend $100 or more on APMEX [the online retailer of the metals] products until August 11.”

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This morning in metals news, U.S. steel mills shipped 3.2% more steel in June 2018 than in June 2017, President Donald Trump announced the doubling of steel and aluminum tariff rates against Turkey, and Ford is feeling the effects of rising metals prices.

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Steel Mills See Year-Over-Year Shipment Rise

U.S. steel mills shipped 7,988,026 net tons of steel in June, according to data released by the American Iron and Steel Institute (AISI).

The total marks a 0.8% decrease from the previous month, but a 3.2% increase from June 2017.

In the year to date, shipments have amounted to 47,304,057 net tons, a 4.1% increase compared with the first six months of 2017.

Trump vs. Turkey

While much of the focus has been on the deterioration of relations or escalation of tensions with China and even the E.U., in recent weeks the U.S.’s relationship with Turkey has taken a hit.

President Donald Trump announced Friday that his administration will double the steel and aluminum tariffs on Turkey, bringing them to 50% and 20%, respectively.

The relationship between the two countries has taken a hit in recent months following the U.S.’s imposition of Section 232 tariffs on steel and aluminum. In addition, last week the U.S. imposed sanctions on Turkish officials in relation to Turkey’s detainment of American pastor Andrew Brunson on charges of espionage.

Price Pressure

Rising steel and aluminum prices are weighing on Ford’s business, one Ford official said this week.

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Jim Farley, president of global markets, called the rising costs a “significant headwind,” as quoted by Bloomberg, but added the automaker does not plan on passing on the added costs to consumers.

Before we head into the weekend, let’s take a look back at the week that was and some of the metals stories here on MetalMiner®:

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MetalMiner’s Annual Outlook provides 2018 buying strategies for carbon steel

The August Aluminum Monthly Metals Index (MMI) fell two points last month. The current Aluminum MMI index now stands at 93 points.

Buying Aluminum in 2018? Download MetalMiner’s free annual price outlook

LME aluminum prices fell in July. However, the rate of the declines has slowed. Price changes do not appear to be sharp and selling trading volume remains weak. The price decrease looks like a retracement after the peak in April due to Russian sanctions.

Source: MetalMiner analysis of FastMarkets

LME aluminum prices have fallen again toward the stiff support level that aluminum prices had during 2017 and 2018. LME aluminum prices fell towards that support level in December 2017, in April 2018 and back again in July 2018. However, aluminum prices rebounded each time (and again in July) from that level.

How aluminum prices react to this stiff support level will give some insight on upcoming aluminum price movements. Buying organizations will want to follow aluminum price movements closely to identify the perfect moment to buy forward and lock prices.

Chinese Aluminum

Chinese aluminum output increased by 1.6% in June, according to the National Bureau of Statistics.

The gradual ramp-up of new smelting capacity has increased production. The daily output figure increased to 94,000 tons in June versus the previous 90,000 in May, signaling an increase of 0.8% year on year.

Chinese increased exports received a boost from a favorable price arbitrage, with a weaker yuan. Exports reached 510,000 tons in June, the second-highest figure on record.

U.S. Domestic Aluminum

As a result of the ongoing uncertainty in the aluminum market, U.S. aluminum Midwest premiums have skyrocketed this year.

August’s premiums, however, have started to decrease, sitting at $0.19/pound. The current premium has slid to April 2018 levels, but still appear close to its four-year high at $0.20/pound.

Source: MetalMiner data from MetalMiner IndX(™)

What This Means for Industrial Buyers

Despite the recent downtrend, the LME aluminum price trend suggests a continuation of the bull market that started last year.

Adapting the right buying strategy is crucial to reduce risks. Buying organizations that want to start doing so now may want to take a free trial now to our Monthly Metal Buying Outlook.

Want to see an Aluminum Price forecast? Take a free trial!

Actual Aluminum Prices and Trends

The metals in the Aluminum MMI basket generally fell this month.

LME aluminum prices decreased this month by 3.88%, with a closing price in July of $2,076/mt. Meanwhile, Korean Commercial 1050 sheet traded flat in August, with a reading of $3.57/kilogram.

Chinese aluminum primary cash prices increased by 0.361%, while China aluminum bar fell 5.33%. Chinese aluminum billet prices also decreased 5.33% this month, to $2,197/mt.

The Indian primary cash price fell by 3.27% to $2.07/kilogram.

The Stainless Steel Monthly Metals Index (MMI) fell again this month. The slide of four points moved the index to 78 from the previous 82 reading. The index fell back to May 2018 levels.

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The index dropped due to a slight fall in LME nickel prices in July. However, LME nickel prices seem to have recovered again. Stainless steel surcharges also fell this month.

However, stainless steel surcharges remain in a strong uptrend.

LME Nickel

In July, nickel price momentum slowed slightly.

However, LME nickel prices — and the base metals complex, in general — are showing strength so far again this month.

Despite the two-month downtrend, nickel prices have remained in an uptrend since last summer (June-July), when prices started to increase sharply.

Source: MetalMiner analysis of FastMarkets

Prices fell starting in June 2018 from the $15,895/mt level toward the current $13,825/mt level. Buying volume appears stronger than selling volume and, therefore, supports the uptrend.

A fundamental tightness in the nickel market could also add more support to nickel prices.

The Philippines government confirmed that just 23 out of the 27 mines that operate in the world’s second-largest nickel-producing country will continue to operate. The remaining four will likely close. The decision comes from a previous report (released in July).

Domestic Stainless Steel Market

Domestic stainless steel surcharges fell for the first time since the beginning of the year.

The 316/316L-coil NAS surcharge fell to $1/pound, while the 304/304L decreased to 0.73/pound.

Source: MetalMiner data from MetalMiner IndX(™)

The pace of stainless steel surcharge increases seems to have slowed this month, along with steel (and stainless steel) price increases. However, stainless steel surcharges remain in a clear uptrend and are well above 2015-2017 lows.

What This Means for Industrial Buyers

Stainless steel price momentum slowed down slightly this month. However, both steel and nickel remain in a bull market.

Therefore, buying organizations may want to follow the market closely for opportunities to buy on the dips.

To understand how to adapt buying strategies to your specific needs on a monthly basis, take a free trial of our Monthly Outlook now.

MetalMiner’s Annual Outlook provides 2018 buying strategies for carbon steel

Actual Stainless Steel Prices and Trends

Both Chinese 304 stainless steel coil and Chinese 316 stainless steel coil prices fell this month by 2.78%.

Chinese Ferrochrome prices decreased this month by 2.04%, to $1,930/mt.

Nickel prices fell 7.33% to $13,900/mt.