Viewpoints 2021: Metals

Author Blake Hurtik, Editor, Metals

Global metal markets entered 2021 after a volatile 2020 defined by the shock of the Covid-19 pandemic, which shut down or significantly curtailed many facets of supply chains, followed by, in many cases, a resurgence of demand driven primarily by China.

The new year has begun with steel, scrap, base metal and many minor metals at multi-year highs—a situation hard to conceive months ago during the depths of the initial Covid-19 wave. The strength and duration of China’s recovery, the ability of other key economies to get the pandemic under control, progress in electric vehicle production and demand for commercial airplanes will define markets as 2021 progresses.

Viewpoints

Ferrous

China’s steel output to rise beyond 1bn t
China's steel industry is expected to keep growing in 2021 as a global supply deficit boosts its exports and Beijing maintains support for its housing and manufacturing sectors. By China staff and Chris Newman.

Beijing’s coal ban boosts Canberra’s coffers
Whatever the reasons for China's curbs on imports of Australian coal, it is safe to say that economics are not among them. Beijing's ban even seems to be indirectly benefitting the finances of its leading raw material supplier, despite the continuing political fallout. By Jo Clarke.

China-Australia spat may up Capesize miles
Capesize shipments from east Australia to China have declined sharply following China's introduction of an informal ban on Australian coal, but a shift in trade flows if the ban continues could increase Capesize tonne-miles and support rates in the long term. By Will Collins and Saleem Rizvi.

China scrap demand to dent pig iron
Seaborne basic pig iron (BPI) prices are expected to ease in early 2021 from recent high levels as new Chinese ferrous scrap import regulations potentially cut that country's appetite for the steelmaking raw material. By Zach Schumacher.

Limited relief seen for iron ore supply pain
The global 1.8bn t/yr seaborne iron ore market is expected to remain in a supply deficit in early 2021, as prices at nine-year highs have yet to bring significant new supply to the market. By China staff and Chris Newman.

GCC construction struggling through pandemic
The construction industry in Gulf Co-operation Council (GCC) has suffered greatly this year. The economic shocks of Covid-19 and tumbling oil prices have left demand for construction materials such as rebar weak for most of the year. By Sam Angell.

UK should tread carefully on Turkish HRC
Industry association UK Steel should tread carefully when assessing whether or not to seek anti-dumping duties on imports of Turkish hot-rolled coil (HRC). By Colin Richardson.

CIS billet and wire rod poised for strong 1Q
Strong global demand for billet and wire rod encouraged some CIS producers to redirect volumes to exports or increase production, reducing rebar supply. By Elena Grebiniuk.

US steel supply to remain short in 1Q
The US steel market is expected to remain undersupplied through the first quarter of 2021, with a lack of imports and steel production continuing to weigh on the market. By Rye Druzin.

US Fe scrap exports hinge on China in 2021
US west coast ferrous scrap exporters expect the current robust market to persist into early 2021, with the longer-term outlook clouded by rising blast furnace capacity in Asia and the possibility of Chinese ferrous scrap imports from the US. By Will Ehrhardt.

US ferrous scrap enters 1Q with tailwinds
The US domestic ferrous scrap market heads into 2021 supported by strengthening tailwinds consisting of a surge in global ferrous scrap demand, gains in finished steel prices and supply/demand imbalance. By Brad MacAulay.

Base metals

China, vaccines add to copper upside
Copper prices end a tumultuous 2020 surging to multi-year highs, fueled by a post-pandemic demand boom in China and rising optimism for US demand as vaccine distribution ramps up. By Mike Hlafka.

China to import more nickel sulphate in 2021
New nickel sulphate projects outside China will attract more interest from Chinese consumers in 2021 owing to the rapid development of its new energy vehicle (NEV) industry and tightening domestic supply, with the country's imports poised to keep ramping up. By Shanghai staff.

Aluminium in overdrive into 2021
The European aluminium market has continued to heat up in December, rendering the positive outlook given by the industry a month ago somewhat undercooked, and meaning that prices and premiums will very likely be strongly supported through much of the first half of 2021. By Jethro Wookey.

Zorba rallies into 2021
Global zorba prices in the first quarter will be determined by a mix of strong southeast Asia demand and base metal exchange prices, countered by potentially larger supply of the shredded nonferrous byproduct, as surging ferrous scrap pricing brings more cars and light iron to shredders. By John Betz.

US A380.1 alloy prices to climb in 1Q
US prices for automotive aluminum alloy A380.1 are expected to rally into the first quarter with a boost from scrap, tight furnace capacity and strong demand from automakers. By John Betz.

Stainless gains momentum into 2021
US stainless scrap prices are widely expected to remain at high levels going into the first quarter of 2021, supported by a combination of tight supply and high raw material costs. By Pete J. Stavretis

Cu concentrate market set for tight 2021
The copper concentrate market is likely to remain tight in 2021, with demand growth poised to significantly outpace production hikes and launches.

Minor metals

Renewed demand to bolster Mg prices in 2021
Chinese magnesium (mg) metal prices may rise in 2021 in light of a recovery in consumer demand from the downstream aluminium and automotive industries. By Beijing staff.

China to drive Mo prices, Europe demand key
The molybdenum market has been "saved" by voracious buying from China in 2020, a trend that is likely to continue in 2021 even as demand in the western world re-emerges. By Maximilian Court.

US defense restrictions to support tantalum
Recent restrictions placed on the military supply chain have tightened tantalum scrap supply in the US, a trend which sources expect could last well into 2021 and support prices. By Andrew Saucer.

China's chrome demand may rise in 2021
Expected growth in China's stainless steel production next year is likely to boost the country's chrome demand, especially given a potential recovery in stainless steel exports with the anticipated easing of the Covid-19 pandemic.

Yuan likely to keep bolstering China prices
The past six months have seen Chinese export prices for certain key metals gain support from yuan-dollar exchange rate movements, and that support is likely to remain in the near term owing to the country's continued economic recovery and fiscal policies. By Ellie Saklatvala.

Smelters continue to chase cobalt supply
After an unprecedented year in 2020, the cobalt market will likely continue to actively seek raw materials this year in anticipation of supply constraints and higher demand from the electric vehicle (EV) sector.

Supply-side factors dominate gallium prices
Temporary environmental restrictions on bauxite production in China sparked steep price rises for gallium at the end of 2020, pulling up prices in Europe despite Covid-19 hitting demand, while other smaller market forces may become increasingly influential in the coming years. By Caroline Messecar.

Chinese demand supports germanium prices
China's germanium market will likely maintain its uptrend in 2021 thanks to higher demand from the 5G telecommunication sector, expectations of a supply shortage and rising prices as a result of increasing demand from the infrared technology sector.

Europe’s 5G rollout needs to pick up pace
Europe's rollout of 5G telecoms infrastructure has continued this year despite Covid-19 disruptions, but progress will need to accelerate if the region is to catch up and compete with major markets in Asia-Pacific and the US. By Ellie Saklatvala.

China tungsten prices to rise in 2021
Chinese tungsten prices are expected to rise steadily in 2021 on expectations of a recovery in the global economy and as production cuts take effect. By Beijing staff.

Metals demand to ride green energy wave
Plans to reduce carbon emissions worldwide are likely to accelerate as governments unveil green stimulus measures to revive economic growth in the post-Covid-19 era, increasing demand for many minor metals. By Anuradha Ramanathan.

V demand to be driven by alternative sources
Growing interest from the battery sector is expected to bolster demand for vanadium in high pressure forms this year, potentially lending support to a tightly-balanced market with producers sold out until early February and global steel production remaining robust. By Maximilian Court.

Weak oil and gas pressures WC scrap
A stunted recovery in the oil and gas sector is expected to undercut any rise in tungsten carbide (WC) prices in early 2021, even as other sectors have already returned to prior-year levels. By Nicholas Bell.

Europe Mn flake prices to pull back in 2021
European prices for manganese flake are likely to pull back in the first quarter of 2021, after a recent increase in freight rates for material being exported from China led to a jump in prices in the fourth quarter. By Yusuf Khan.

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