Industry News

This morning in metals news: a cold winter season will continue to put strain on European energy supplies; the U.S. international trade deficit declined from September to October; and, lastly, U.S. job openings increased in October.

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Energy prices under the microscope amid chilly weather in Europe

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Europe is bracing for the winter season, which brings with it further strain on already strained energy supplies.

Storm Barra impacted Ireland and the United Kingdom on Tuesday, bombarding the islands with rain and snow.

According to ICE data, Dutch TTF gas futures for January 2022 picked up in November, rising from €67 per megawatt hour Nov. 1 to €96 per megawatt hour this week.

As we noted on the heels of the October price spike, rising energy costs impacted European zinc producers, like Nyrstar and Glencore. LME zinc jumped to $3,757 per metric ton in October but fell to around $3,200 to start November. Since then, the price has trended sideways but remains elevated, according to MetalMiner Insights data.

Russia is the largest supplier of natural gas supply to Europe; rising gas costs contributed to production cutbacks from the aforementioned zinc producers. On Nov. 22, the U.S. announced sanctions against two vessels and one Russia-linked entity related to the Nord Stream 2 pipeline.

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This morning in metals news: steel capacity utilization fell to 81.9%; lead prices have lost ground this month; and, lastly, Liberty Steel announced the restart of its Georgetown, South Carolina plant.

During the last MetalMiner webinar of 2021, the MetalMiner team will take a look ahead and overview price predictions for 2022. To attend, sign up on the MetalMiner Events page. 

Steel capacity utilization rate falls to 81.9%

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The U.S. steel capacity utilization rate fell to 81.9% for the week ending Dec. 4, the American Iron and Steel Institute reported.

U.S. steel output during the week totaled 1.81 million net tons, or down 1.6% from the previous week. For the year to date, steel production totaled 88.08 million net tons, or up 19.6% year over year, at a capacity utilization rate of 81.6%.

U.S. steel prices began to backtrack in September after a year of uninterrupted rises.

Hot dipped galvanized closed last week at $2,131 per short ton, or down 3.8% month over month, according to MetalMiner Insights data.

Hot rolled coil closed last week at $1,770 per short ton, or down 6.1% month over month.

Lead prices retreat

Meanwhile, lead prices have lost ground so far this month.

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This morning in metals news: Nucor Corporation announced plans to build a rebar micro mill; oil prices fell last week; and, lastly, tin prices have rallied.

Each month this year, MetalMiner has hosted a webinar on a specific metals topic. The final webinar of 2021 is this Wednesday, Dec. 8, during which MetalMiner experts will overview their price predictions for 2022. 

Nucor to build rebar micro mill

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Nucor Corporation said it will build a new rebar micro mill in the South Atlantic region.

The firm already has rebar micro mills in Missouri and Florida.

The new mill will have a budgeted capex of $350 million, the firm said, with an annual capacity of 430,000 tons.

“We have recently executed two successful rebar micro mill start-ups and believe the East Coast market will be in need of additional rebar supply in the coming years, particularly with the recent passage of the infrastructure spending bill,” Nucor President and CEO Leon Topalian said. “Rebar has been a core business for Nucor since we got into steelmaking and this project will enable us to maintain our leadership position in the rebar market.”

Oil price slides

Oil prices retreated last week after previously surging above over $80 per barrel ahead of Thanksgiving.

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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:

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Week of Nov. 29-Dec. 3 (hot rolled coil prices, Alcoa announces smelter restart and more)

• Christopher Rivituso on a drop in European hot rolled coil prices.
• General Motors recently announced it bought a 25% stake in Pure Watercraft, a Seattle-based firm that focuses on “all-electric boating solutions.”
• Almost two years after its nickel ore export ban went into effect, Indonesia’s president indicated the country could impose nickel and copper concentrate export bans.
• Alcoa said the joint venture Portland Aluminium smelter in Australia will restart after having remained idle since 2009.
• The U.S. steel capacity utilization rate for the week ending Nov. 27 fell to 83.2%.
• The CEO of Chilean copper giant Codelco said copper prices could dip next year.
• Meanwhile, oil prices lost significant ground this week, with Brent crude dipping below $70 per barrel at points.
• Lastly, Russian steel group NLMK is boosting capacity at its Mill 1000 hot rolling facility.

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This morning in metals news: tin prices have surged; Norsk Hydro announced the end of a previously announced battery initiative; and, lastly, Cleveland-Cliffs is buying a ferrous scrap processor.

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Tin prices gain

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As we noted earlier this week, news that Indonesia is considering a tin export ban is offering some support to tin prices.

LME three-month tin reached $39,250 per metric ton this week, up 7.2% month over month, according to MetalMiner Insights data.

Meanwhile, from a technical perspective, LME tin trading volumes reached a November peak of 7,138 on Nov. 16. Volumes fell as low as 2,538 later in the month before bouncing back up.

Subscribers can find more tin insights in this month’s Monthly Metal Outlook report.

Norsk Hydro announces end to battery initiative

Earlier this year, Norsk Hydro announced plans to extend its joint battery initiative with Panasonic and energy firm Equinor.

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Novolipetsk Iron & Steel (NLMK) is undertaking at its main production site in Russia upgrade work on one of the slab reheating furnaces, which will see hot rolling Mill 2000’s capacity rise by 7%, the steelmaking group said.

The planned work will push Mill 2000’s annual rolling capacity up by about to approximately 6.23 million metric tons, NLMK indicated.

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The mill’s current rolling capacity is now 5.8 million tons, group spokeswoman Marina Simonova told MetalMiner.

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NLMK upgrade work

Upgrade work on the reheating furnace includes installation of equipment that can automatically adjust the temperature, depending on the grade of steel that Mill 2000 rolls. The work will also lower carbon emissions from the furnace by 53,000 metric tons, the group said.

Work on the reheating furnace will also result in a 23% increase in its own annual throughput capacity to 2.25 million metric tons per year, from 1.83 million metric tons, group figures indicated.

NLMK plans to complete work on and restart the furnace in Q2 2023. Estimated cost of the project is ₽5 billion ($67.8 million), the group also said.

The work, however, will not impact Mill 2000’s operations, as there are four additional furnaces that have already undergone overhauls.

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This morning in metals news: OPEC held its 23rd ministerial meeting today amid falling oil prices; meanwhile, the United States International Trade Commission issued a ruling on import relief for the domestic crystalline silicon photovoltaic cell sector; and, lastly, the trade ministers of the U.S., Japan and the E.U. convened this week.

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OPEC meets as oil prices retreat

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Rising oil prices have been yet another strain on consumers, whether commercial users or everyday motorists at the pump. Oil prices are also a key factor in MetalMiner’s commodity trends analysis.

In the U.S., pre-Thanksgiving gasoline prices reached their highest level this year since 2012.

However, oil prices this past week have lost ground quickly. The WTI crude price, for example, closed Wednesday at $65.57 per barrel, down $12.82 per barrel from the previous week, the Energy Information Administration reported.

OPEC, meanwhile, convened via videoconference today for its 23rd ministerial meeting, during which it agreed to maintain previously agreed output schedules. The group agreed to “reconfirm the production adjustment plan and the monthly production adjustment mechanism approved at the 19th ONOMM and the decision to adjust upward the monthly overall production by 0.4 mb/d for the month of January 2022, as per the attached schedule.”

USITC votes on import relief for PV cell makers

United States International Trade Commission (USITC) voted to keep import relief measures in place for domestic producers of crystalline silicon photovoltaic cells.

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Chilean copper producer Codelco, the world’s largest, indicated it could see copper prices coming down in 2022.

According to a Reuters report, Codelco CEO Octavio Araneda said prices in 2022 will likely come in slightly lower than in 2021.

As we’ve noted recently, MetalMiner is hosting its final webinar of the year on Wednesday, Dec. 8, during which the MetalMiner team will overview price predictions for metals in 2022. Those interested in participating in the session can sign up on the MetalMiner Events page.

Copper prices stabilize

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Like aluminum, LME copper prices on the LME surged to $10,270 per metric ton in late October, according to MetalMiner Insights data.

The price fell back to close the month, however, closing October at $9,490 per metric ton.

Since then, the copper price has trended sideways.

From a technical perspective, LME copper trading volumes reached a November high of 145,635 as of Nov. 2. Volumes fell as low as 69,991 on Nov. 25, during which prices surged briefly and approached MetalMiner resistance levels.

However, the stronger the trading volume, the greater the significance of a corresponding price movement (and vice versa). As such, after jumping to just under $9,900 per metric ton Nov. 25, the price retreated.

LME three-month copper closed the month at $9,510 per metric ton.

Political crossroads

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This morning in metals news: the U.S. steel capacity utilization rate fell to 83.2% last week; North American Stainless maintained its stainless steel fuel surcharge; and, lastly, crude oil prices have lost steam this week.

Each month, MetalMiner hosts a webinar on a specific metals topic. The MetalMiner team will discuss price predictions for 2022 during its final webinar of the year, scheduled for Wednesday, Dec. 8. 

US steel capacity utilization rate hits 83.2%

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The U.S. steel capacity utilization rate fell to 83.2% for the week ending Nov. 27, down from 84.3% the previous week, the American Iron and Steel Institute reported.

Steel output last week totaled 1.84 million net tons. The total marked a 1.3% decline from the previous week but a 13.3% year-over-year gain.

For the year to date, production reached 86.3 million net tons, or up 19.7% year over year.

U.S. steel prices have finally started to soften. U.S. HRC closed last week at $1,793 per short ton, according to MetalMiner Insights data, or down 5.6% month over month. Meanwhile, U.S. CRC closed at $2,111, down 0.3% month over month.

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Two years ago, Indonesia instituted a ban on nickel ore exports.

Now, it is contemplating banning exports of tin and copper ore, too.

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Indonesia export bans prompt tin price surge

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Indonesian President Joko Widodo has been announcing from different forums that his country may stop the export of bauxite next year, copper ore in 2023 and tin in 2024.

On the heels of the announcements, the tin price has surged, MetalMiner Insights data shows. (Subscribers can find additional tin and copper analysis in the next Monthly Metal Outlook report, which will be released Wednesday, Dec. 1.)

The LME three-month tin price closed Monday at $39,450 per metric ton. The price is up 6.6% month over month.

For long, Indonesia has been a major exporter of metal ores, mostly to Asian countries, including China and Japan. The ban on nickel exports had triggered investments, mostly from China, into Indonesian nickel processing.

As part of efforts to improve the country’s external balance & attract investments into the resource processing industry, Indonesia may stop tin exports in 2024, the Indonesian President reiterated last week at the Indonesian central bank’s annual gathering.

The president has made similar statements in recent public appearances about the country’s long-term dependence on raw commodities, reducing its export earnings and employment opportunities.

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