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The ferrous portfolio includes established Argus price indices for 62pc and 65pc iron ore fines, Turkish ferrous scrap imports, and our fob Australia and cfr China premium hard coking coal indices.
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Viewpoint: US tariffs altering UBC buying in ’26
Viewpoint: US tariffs altering UBC buying in ’26
Houston, 24 December (Argus) — Consumers of used beverage cans (UBCs) likely will seek to purchase more of the scrap grade on a spot basis in 2026, minimizing their exposure to long-term supply agreements after buying spreads widened to historical lows this year on the back of a record-high regional premium. Sell-side sources estimate that most rolling mills reduced their volumes under contract between 10-20pc for next year compared to 2025 levels, reflecting a shift in consumers' procurement strategies after US tariffs on aluminum imports disrupted price mechanisms against which UBCs and other grades of scrap are traded. "All mills directionally did less contract pounds. That showed up everywhere," a broker said about 2026 negotiations. "They all want more flexibility to buy spot." Rolling mills locked in annual contracts for 2025 at tight discounts to the Midwest transaction price (MWTP), with sources saying that most deals were struck on either side of 80pc within a narrow range. Supply availability of UBCs was constrained at the end of 2024, prompting consumers to accept brokers' and dealers' higher offers to ensure stable inflows of scrap. But US trade policies and White House threats against major trading partners provoked a surge in the Midwest P1020 premium, which led to a sharp rise in the MWTP and an influx of UBC imports from overseas suppliers, with shipments setting a one-month high of 30,082 metric tonnes (t) in May as importers sought to take advantage of higher prices in the US, customs data showed. The US imported an average 16,230t of the scrap every month from 2023-2024, according to customs data. The regional upcharge climbed by more than 270pc from the start of the year to an all-time high of 88¢/lb as of 10 December, Argusdata showed. The MWTP rose by 56pc to $2.1665/lb in the same timeframe, with gains in the premium far outpacing increases in the London Metal Exchange (LME) cash settlement — the other component that comprises the MWTP. Buying spreads, as a result, dropped from an average of 80.8pc in January to an average of 45.3pc in November — reaching a low of 44.4pc on 29 October — after supply tightness eased and consumers widened discounts, saying underlying fundamentals did not support paying more for UBCs just because intrinsic values had risen, which several viewed as artificial increases. That sentiment from buyers has been reflected in outright prices for UBCs, which fell by a smaller margin — down by 13¢/lb, or by 12pc, to 98.5¢/lb at the end of November — compared to buying spreads. Still, that divergence in discounts led to a significant discrepancy between what rolling mills had to pay brokers and at what levels they could purchase UBCs in the spot market. This compelled consumers to take on more volumes from the trade or under shorter-term supply deals in 2026 in efforts to avoid a repeat of 2025. Consumers have already entered the spot market for significant tonnage for January, with one rolling mill having already closed out its next-month position and another procuring north of 40 truckloads so far. Buyers at the consumer level say they want to purchase more UBCs on the spot market to help fill the balance of their needs despite lower contract volumes. Sources noted that most rolling mills' overall consumption forecasts for 2026 are relatively stable based on downstream demand for beverage-can sheet. Adding to upward pressure on UBC demand are Section 232 import tariffs, which currently stand at 50pc. Consumers have sought to utilize more scrap for their melts to help offset elevated costs for P1020 and other grades of primary aluminum — a trend that most expect to persist next year. Beverage-can sheet can utilize a higher percentage — as high as 90pc, Argus understands — of scrap as an input compared to other flat-rolled products, precluding the need for rolling mills to use primary aluminum in their melts. Sources have signaled that first-quarter contracts with rolling mills have been locked in between 51-54pc of the MWTP, with buying spreads for annual deals that have been concluded coming in between 55-62pc broadly — depending on volume and the quality of UBCs. With those discounts, buyers effectively have priced in expectations that US tariffs on primary aluminum will persist throughout the year. Some market participants are optimistic that negotiations on a new US-Mexico-Canada free trade agreement will result in a tariff carveout for aluminum from top US supplier Canada. Still, there have been no concrete indications that such a reduction, which likely would spur a drop in the Midwest premium, will come. Challenges to 2026 consumption While most consumers' indicated demand levels have not changed significantly, suppliers and brokers are monitoring developments with two major rolling mills to see how certain constraints may impact industrywide consumption for UBCs in 2026. Aluminum-roller Novelis' hot-rolling mill outage at its facility in Oswego, New York, which primarily produces flat-rolled products for the automotive industry, has forced the company and its domestic competitors to scramble to meet automakers' needs. Those efforts have included shifting manufacturing lines away from other end markets to focus on producing automotive-grade sheet or hot-rolled coil, also known as "hot band". Sources also noted that new entrant Aluminum Dynamics' (ADI) demand for UBCs may not be as significant for next year as market participants originally thought when the company first announced its 650,000 metric tonne (t)/yr plant in Columbus, Mississippi. ADI planned to build satellite facilities in Arizona and Mexico to supply Columbus, with those sites recycling UBCs to melt into slab for production of beverage-can sheet. The Arizona plant has yet to be built, with the company contending with locals who have been fighting its construction, while the Mexico facility is operational, but products from the site have been subject to import tariffs, sources said. By Alex Nicoll Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
Oversupply, rains drag Indian HRC prices lower in 2025
Oversupply, rains drag Indian HRC prices lower in 2025
Mumbai, 24 December (Argus) — Domestic Indian hot-rolled coil prices started 2025 on a strong note, but extended monsoons and abundant supply resulted in a steady decline from May, pushing prices below levels seen at the start of the year. The monthly average of the domestic 2.5-4.00mm HRC price assessed by Argus rose to 51,630 rupees/t ($569/t) in May, excluding goods and services tax (GST), from Rs47,360/t in January. The average price for December was Rs45,775/t as of 12 December. Indian HRC prices rose sharply between the end of February and early May on speculation around safeguard duties and supply shortages driven by mill maintenance work. India imposed 12pc provisional safeguard duties from 21 April, which led to a moderation in imports, particularly from China. Despite lower imports HRC prices began a steady descent from around mid-May. This was because the monsoon season started early and went on for longer than expected. Demand was slow to recover after monsoons, which along with surplus supply stemming from expanded domestic capacities kept prices under pressure in the final quarter of the year. As domestic demand struggled to catch up with supply, Indian producers grappling with rising inventories looked for more export opportunities in the second half of 2025. Indian HRC was exempt from anti-dumping duty in the EU, which had resulted in a surge in European demand at the end of March, but activity dwindled around August because of summer holidays in the bloc. But from September, Indian mills were able to sell sizeable volumes into Europe, as buyers began stockpiling ahead of changes related to the carbon border adjustment mechanism (CBAM) and safeguard quotas expected in 2026. But prices remained under pressure as mills were forced to lower offers to entice buyers amid uncertainty related to CBAM taxes. While much of the focus was on the Europe during this period, Indian suppliers also sold some quantities to the Middle East and Vietnam. But these sales were concluded at much lower price levels, compared with those in the EU, because of competition from China in those markets. India became a net exporter of finished steel in October and November as exports surged and imports dropped on safeguard measures. European buying interest waned again towards the end of the year as buyers scrambled to understand CBAM taxes after draft documents circulated in the market. India exhausted its fourth-quarter HRC quota in November, and the possibility of the January-March quota also getting utilised quickly meant buyers remained cautious. Rumours that the post-safeguard quota changes could come into effect from April instead of July also sapped interest in Indian HRC. The monthly average cfr Europe price for Indian HRC fell from $630/t from April to $560/t as of 12 December. The average fob India HRC price for December stood at $477.50/t, declining from an average of $570/t in April. Indian exporters' focus has now shifted to Vietnam, a market where bids have been declining over the past few months. Indian suppliers could target alternate markets for HRC sales in 2026 as CBAM and quota changes impede shipments to Europe, market participants said. By Amruta Khandekar Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
Viewpoint: EU safeguards may shift FeSi, Si demand
Viewpoint: EU safeguards may shift FeSi, Si demand
London, 23 December (Argus) — New European Commission safeguard measures will support ferro-silicon prices in 2026, but they will also drive increased substitution of the alloy with silicon metal. The commission imposed safeguard measures on manganese alloys, ferro-silicon and ferro-silico-magnesium on 18 November. The safeguard measures comprise tariff-rate quotas and out-of-quota variable duties. Imports in excess of the quota are subject to an out-of-quota variable duty that is the difference between the established price threshold and the actual import price. The commission has imposed an established price threshold of $2,408/t on ferro-silicon. This is more than double the average Argus assessment of $1,371/t ddp NWE as of 12 December. Market gains clarity after a tumultuous 2025 The safeguard investigation that led to the implementation of safeguards drove several extreme spikes in volatility in the ferro-silicon market over the course of 2025. Rare updates on the safeguard process, sudden bursts of speculation and delays led to periods with sharp surges in imports and transactions and then periods with almost no liquidity, as market participants waited for news from the commission. As a result, ferro-silicon prices were volatile across the year, with buyers and sellers alike unsure how to react. Market participants, particularly trading firms, bemoaned their inability to carry out advanced planning. Prices rose in the first quarter, as market participants stocked up on third-country material in expectation of an announcement from the commission by April. When no outcome was announced, prices decreased from March-June. Prices rose sharply in late July and early August because of speculation that the announcement was forthcoming, and then plummeted again for September, October and much of November. Safeguards to drive higher prices, volatility in 2026 After the announcement of the new measures on 18 November, prices jumped by almost $300/t and have since remained at around and slightly above $1,500/t. Most market participants expect prices to stay at current levels or higher in the coming year. But continued volatility is expected. The new quota system, which renews every three months, is expected to result in altered purchasing habits as material enters the European market in bursts after the quotas renew. In this first three months of the safeguard measures, many of the quotas have been utilised more slowly than market participants expected. Some are still not full. But that has been attributed in part to hesitation from importers to try out the new system and in part due to low demand from end-users, which stocked up ahead of 18 November and are not buying in large quantities at present. One steel producer continues to refrain from buying and has been holding off since before the safeguards took effect, a senior executive at the company told Argus . Many market participants expect a more rapid utilisation of the available quotas in the first and second quarters of 2026, as industry players adapt to the new dynamics and consumers work through much of their existing stocks. Significant quantities of ferro-silicon are expected to enter Europe over the days that immediately follow the start of each new period. For consumers and importers, supply chain management has become significantly more complex and requires newly advanced planning. Importers now have more customs exposure, increasing their risk. Silicon substitution may increase Silicon metal can be substituted for ferro-silicon in many steel applications, although the deoxidisation provided by ferro-silicon cannot be completely replicated using silicon metal and iron powder. Silicon metal has not been included in the safeguards, despite a strong desire for it to be subject to the measures from many ferro-alloy producers. Euroalliages, the main ferro-alloys industry association, [sought]( https://metals.argusmedia.com/newsandanalysis/article/2752028) the inclusion of safeguards in the initial measures. And major European ferro-alloys producer Ferroglobe continues to call for protectionist measures on silicon. But with silicon currently not subject to any such measures, consumers are likely to purchase silicon in place of ferro-silicon when it makes sense to do so on cost. Substitution is already taking place. Multiple large tenders after the implementation of safeguards went to silicon metal rather than ferro-silicon, a ferro-silicon producer told Argus . "As a manufacturer, we see it as an inconvenience that the customer gets used to using alternative products, and we are trying to avoid that by not pushing very high prices," the producer said. The substitution possibility is likely to put a ceiling on ferro-silicon prices below that of the minimum import price in 2026. If out-of-quota material is too expensive, consumers will turn to silicon metal, reducing demand for ferro-silicon and holding prices lower. "Price dynamics will be following silicon metal instead of market supply and demand. It will be silicon metal substitution that will be the price setter, and that is far below the ferro-silicon market," the producer said. But there is ongoing speculation that anti-dumping procedures for silicon metal are being prepared by the commission. If implemented, silicon metal would be more expensive than ferro-silicon from certain origins, which would reduce the substitution effect and support higher ferro-silicon prices. By Maeve Flaherty Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
US economy expands by 4.3pc in 3Q
US economy expands by 4.3pc in 3Q
Houston, 23 December (Argus) — The US economy grew at the fastest pace in two years in the third quarter, reflecting increases in consumer spending, exports and government spending that were partly offset by a decrease in investment. Growth in gross domestic product (GDP) grew at a 4.3pc annual rate in the third quarter, according to the first of three estimates by the Bureau of Economic Analysis. That compared with 3.8pc growth in the second quarter and a contraction of 0.6pc in the first quarter. The US GDP growth beat the expectations of analysts surveyed by Trading Economics, who were forecasting growth of 3.3pc. Because of the partial federal government shutdown that ended on 12 November, this initial report for the third quarter replaces the release of the advance estimate originally scheduled for 30 October and the second estimate originally scheduled for 26 November. The report showed that consumer spending continued to fuel the economic expansion, as President Donald Trump retracted or softened some of his announced tariffs. Federal Reserve policymakers expect only one quarter point rate cut next year, as they see GDP growth ending next year at 2.3pc, Consumer spending rose by 3.5pc in the third quarter, following 2.5pc growth in the second quarter. Gross private domestic investment fell by an annual 0.3pc following a 13.8pc decline in the second quarter. Residential investment fell by an annual 5.1pc for a second quarter, as construction and purchases remained constrained by high interest rates. Equipment investment rose by an annual 5.4pc, reflecting spending in artificial intelligence. The Personal Consumption Expenditures price index increased by 2.8pc, accelerating from 2.1pc in the second quarter and well off the Fed's long-term target of 2pc. Exports rose by 8.8pc after a 1.8pc contraction in the prior quarter. Imports fell by 4.7pc after more than a 29pc annual decline in the second quarter. Imports subtract from growth. Net trade added 1.6 percentage points to the headline number. The "massive" contribution to headline growth from net trade "reflected goods imports continuing to slide, while exports remain resilient," Pantheon Macroeconomics said in a note. "That partly is due to the very limited retaliation to the tariffs from most trade partners, although the scale of the net trade boost to growth in (the third quarter) is unlikely to be sustained." Government spending rose by 2.2pc after a 0.1pc decline in the second quarter. Defense spending rose by 5.8pc. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
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