This morning in metals, zinc and nickel dropped to their lowest prices in over a week, another country hints at retaliation vis-a-vis potential U.S. Section 232 tariffs and Chinese steel mills are looking to increase output before future cuts take hold.Need buying strategies for steel? Try two free months of MetalMiner’s Outlook Nickel, Zinc Post […]
Category: Metal Prices
Is the Lithium Market a Bull or a Bubble Set to Pop?
A while back I was called by a journalist at a prominent paper and asked what I thought about the lithium market. Was it another rare earth metals story – limited supply and rapidly escalating demand? Or, worse, was the world simply going to run out of lithium in the face of surging battery demand […]
Is Aluminum Not as Strong as it Should Be?
You may be excused for wondering quite what is happening to the aluminum price. Base metals have continued in a robust rally since the recent volatility knocked prices sideways along with equities and the associated havoc in the bond market. Buying Aluminum in 2018? Download MetalMiner’s free annual price outlook But having fallen, aluminum prices […]
The February MMI Report: Seven of 10 MMIs Rise But Some Metals Cool Off
It’s that time — our latest Monthly Metals Index (MMI) report is in, covering the first month of 2018. Seven out of 10 MMIs posted increases this month. The Renewables MMI was the star of the month, as skyrocketing cobalt and steel plate prices helped push the sub-index up 21 points for a reading of […]
This Morning in Metals: Japan’s JFE Holdings Plans to Spend $6B on Upgrades
This morning in metals news, JFE Holdings Inc. in Japan plans to spend $6 billion on upgrades in the coming years, the Congressional Steel Caucus asked the administration for guidance on the Section 232 action timeline and Shanghai copper posted its biggest price jump since October. Need buying strategies for steel? Try two free months […]
This Morning in Metals: Metal Firms Line Up to Bid for Distressed Essar Steel
This morning in metals, several companies are looking to buy the distressed Essar Steel India Ltd., copper prices bounced back up and gold prices are up. Need buying strategies for steel? Try two free months of MetalMiner’s Outlook Essar Steel on the Market Companies like ArcelorMittal and VTB Group are vying for embattled Indian firm […]
Stainless Steel MMI: LME Nickel Price, Stainless Surcharges Both Rise
The Stainless Steel MMI (Monthly Metals Index) jumped four points again this month for a February reading of 75.
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In January, skyrocketing LME nickel prices drove the Stainless Steel MMI. Nickel prices have climbed above the $13,000/mt level. 304 and 316 surcharges increased this month, returning to their previous levels.
LME Nickel
Nickel prices increased sharply during January. However, prices decreased slightly in early February. As reported previously by MetalMiner, nickel price volatility has increased over the past few months. Therefore, nickel prices may prove quite tumultuous from a short-term perspective and are trading within the orange-dotted band in the chart below.
[caption id="attachment_90272" align="aligncenter" width="580"]
Source: MetalMiner analysis of FastMarkets[/caption]
The long-term nickel price uptrend also remains strong. Prices have moved toward June 2015 levels and already breached our October 2017 long-term resistance levels, as per our Annual Outlook. Therefore, nickel prices remain in a strong uptrend and could continue increasing in the coming months.
Domestic Stainless Steel Market
Following the recovery in stainless steel momentum, domestic stainless steel surcharges increased this month. Surcharges remain above last year’s lows (under $0.4/pound); they remain in an uptrend, even if their pace has slowed. However, buying organizations may want to look at surcharges closely to reduce risks, either via forward buys or hedging.
[caption id="attachment_90273" align="aligncenter" width="580"]
Source: MetalMiner data from MetalMiner IndX(™)[/caption]
FerroChrome vs. Chrome Metal
Two months ago, MetalMiner reported on the anomaly between ferrochrome and chrome metal prices.
[caption id="attachment_90274" align="aligncenter" width="580"]
Source: MetalMiner data from MetalMiner IndX(™)[/caption]
Ferrochrome (FeCr) is a chromium and iron alloy containing 50% to 70% chromium by weight. Historically, Ferrochrome and chrome prices correlate tightly but the high iron ore prices caused ferrochrome to spike. However, both prices (ferrochrome and chrome) have fallen back to their historical trading pattern of moving together.
What This Means for Industrial Buyers
Stainless steel momentum appears in recovery, similar to all the other forms of steel. As both steel and nickel remain in a bull market, 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
This Morning in Metals: Aluminum Industry Testifies to ITC on Foil Imports
This morning in metals news, aluminum industry officials testified to the U.S. International Trade Commission regarding the ongoing aluminum foil investigation, Mexico’s economy minister says automotive rules of origin will change as part of the ongoing renegotiation talks surrounding the North American Free Trade Agreement (NAFTA) and copper is on track for its biggest weekly […]
Raw Steels MMI: HRC Prices Hit Highest Level in More than Two Years
The Raw Steels MMI (Monthly Metals Index) inched three points higher this month, reaching 86 points.
Steel price momentum appears to have continued as prices increased sharply in January. February has already signaled a continuation of this uptrend, with HRC prices breaching the $700/st level. HRC prices have reached the highest levels in more than two years and could continue to climb.
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[caption id="attachment_90232" align="aligncenter" width="585"]
Source: MetalMiner data from MetalMiner IndX(™)[/caption]
The spread between HRC and CRC prices fell this past month, returning to the $140/st level. Since the beginning of 2016, the spread between HRC and CRC prices increased to around $200/st. The spread has returned to normal levels, with HRC prices increasing more than CRC prices.
President Trump has yet to release results from the Section 232 investigation. Commerce Secretary Wilbur Ross sent his Section 232 steel report to Trump last month; the president has 90 days as of Jan. 11 to act on the report’s findings and recommendations.
Global Steel Sector
According to the World Steel Association (WSA), global production of crude steel increased by 5.3% during 2017. The world map below reflects some of the changes in steel production by country and the impact on total steel output.
[caption id="attachment_90233" align="aligncenter" width="585"]
Source: MetalMiner analysis of WSA data[/caption]
Chinese global production of crude steel increased by 5.7%. However, China’s exports fell to 75.4 million tons last year from the previous 108.5 million tons. Japanese production of crude steel decreased by only 0.1%, while U.S. crude steel production increased by 4%.
According to Eurofer, European steel demand could increase by 1.9%. In 2017, European steel imports fell by 1% due to defensive trade measures.
Shredded Scrap
Shredded scrap prices increased again in January, shifting the latest short-term downtrend to an uptrend. The long-term uptrend remains in place, and scrap prices have now moved together with U.S. steel prices.
What This Means for Industrial Buyers
As steel price dynamics showed a strong upward momentum this month, buying organizations may want to understand price movements to decide when to commit mid- and long-term purchases. Buying organizations with concerns about the Section 232 outcome and its impact on the steel industry may want to take a free trial now to our Monthly Metal Buying Outlook. Our Monthly Outlook will include a detailed analysis of the Section 232 outcome.
For more efficient carbon steel buying strategies, take a free trial of MetalMiner’s Monthly Outlook!
Actual Raw Steel Prices and Trends
GOES MMI: GOES M3 Prices Fall Slightly as Imports Rise
The GOES MMI (Monthly Metals Index), which tracks, grain-oriented electrical steels, fell one point to 188 as other flat-rolled steel products saw a price increase.
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Meanwhile, imports continue to grow, but none of the growth has come from China. In fact, Japan and the U.K. supplied the bulk of the imports in January. Buying organizations continue to report to MetalMiner they import grades of electrical steel not currently produced by the sole domestic producer, AK Steel. (See the latest import data below.)
[caption id="attachment_90225" align="aligncenter" width="585"]
Source: International Trade Administration and MetalMiner Analysis[/caption]
AK posted a Q4 loss but CEO Roger Newport made a number of comments regarding electrical steels during the most recent earnings call that indicated why the company supports strong Section 232 import measures:
“As we previously stated, we strongly believe that the ongoing high level of imports is a threat to the national security of our country…
Imports of grain oriented electrical steels, also known as GOES have more than doubled year-over-year and these imports are coming primarily from Japan, Korea and China. In my opinion this surge of GOES imports stems from a deliberate effort on part of these and other countries to beat the clock on any future 232 remedies and also by the Chinese trade protection causing Korea and Japan to send products to the United States.”
Unlike other steel products, such as tubular goods, cold-rolled steel, hot-dipped galvanized steel, solar panels and washing machines, MetalMiner is not aware of a single circumvention case for grain-oriented electrical steels.
Meanwhile, Bank of American Merrill Lynch analyst Timna Tanners double downgraded AK Steel on weak first quarter guidance and “lack of catalysts” to improve margins.
In Other Producer News…
ThyssenKrupp and Tata Steel have finally announced a joint-venture in Europe with the goal of becoming “a leading European flat steel provider and position it as a quality and technology leader,” according to a ThyssenKrupp press release. Both ThyssenKrupp and Tata have GOES production capability.
MetalMiner’s Annual Outlook provides 2018 buying strategies for carbon steel
Exact GOES Coil Price This Month