ISTA urges review of UK steel coil import quotas
Quotas for all steel coil products imported to the UK should be reviewed in light of Tata Steel's transition from producer to importer, the International Steel Trade Association (ISTA) has said in response to the Trade Remedies Authority (TRA).
The ISTA said Tata's imports of hot-rolled coil to enable the production of cold-rolled and hot-dip galvanised coil (CRC, HDG) could affect imports of the latter, meaning that volumes will also need to be reviewed. ThyssenKrupp Materials Trading said all flat-rolled steel quotas should be suspended during Tata's transition to an electric arc furnace, as its "lack of feedstock" could affect production of downstream products, such as CRC and HDG.
Trading firm Kromat said the TRA's idea of apportioning quotas to importers based on historical volumes "potentially denies market opportunities to others and goes against the principle of fair trade". The TRA had initially said it was considering changing the quota for HRC to global, rather than country by country, and giving importers their own slice of this quota. The TRA is meeting ISTA members in London today, 28 February.
A number of newer businesses, or those that historically purchased from Tata but will now increase imports, are concerned about individual importers receiving their own volumes.
Steel service centre Sebden said a quota for individual importers is "deeply anti-competitive" as it could "place too much power in too few hands", referring to the large traders importing to the UK. Sebden also questioned whether slab should be given its own quota, although this is not possible as there is no domestic production.
"As there are no safeguard or anti-dumping measures in place for slabs then there is a very real anti-competitive risk that Tata could, for instance, import cheap Chinese slabs, free from duty, then reroll into HRC or other downstream products", it said.
It also argued that Tata could use "cheap Chinese slab" to feed its own distribution arm, which would then "have an unfair price advantage in the UK for sales to end-users".
Chinese majority-owned trading firm Duferco, a supplier to Sebden and one of the biggest importers to the UK, said the TRA's proposed suspension of import quotas for HRC should be extended to nine months to "promote purchasing activity". Customers buy imported steel on a three-to-six month lead time, so a three-month suspension is insufficient, it said. Sebden echoed this, suggesting that the suspension should be for nine months.
Trading firm Stemcor, which is owned by a Chinese state-owned entity, said there should be a review into dumping duties against China. "How can Chinese imports represent a danger to the UK steel industry if there is no such industry", it said.
Related news posts
Japan’s JBIC to finance Chilean copper mine development
Japan’s JBIC to finance Chilean copper mine development
Osaka, 26 April (Argus) — Japan is enhancing its financial support for the development of copper mines in Chile, as part of efforts to increase its self-efficiency of base metals. State-owned Japan Bank for International Co-operation (JBIC) on 25 April signed a $248mn loan agreement with Chile-based joint-venture Compania Minera Arqueros (CMAQ) to finance development of its Arqueros copper project in Chile. CMAQ is 80pc owned by Japanese copper producer Nittetsu Mining and 20pc by Chilean firm Fondo de Inversion Privado Talcuna. The load will be co-financed by other Japanese private-sector financial firms, including Sumitomo Mitsui Banking, Mizuho Bank and MUFG Bank. The total co-funding will be $355mn. CMAQ plans to use the funding to develop Arqueros, located 35km northeast of La Serena. The mine is expected to produce 1.8mn t/yr of crude ore and 55,000 t/yr of copper concentrates for 15 years. The company aims to start operations in 2026. Nittetsu is to secure all the output from the project. The latest deal follows last month's loan agreement by JBIC and other financial institutes to provide $2.5bn to develop the Centinela copper mine in Chile . Japan relies on all its copper concentrates demand from imports, which has prompted the government to secure long-term and stable supplies of copper resources. The country's strategic energy plan has a target to achieve at least an 80pc self-sufficiency for base metals, including copper, by 2030. By Motoko Hasegawa Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
US economic growth slows to 1.6pc in 1Q
US economic growth slows to 1.6pc in 1Q
Houston, 25 April (Argus) — The US economy in the first quarter grew at a 1.6pc annual pace, slower than expected, while a key measure of inflation accelerated. Growth in gross domestic product (GDP) slowed from a 3.4pc annual rate in the fourth quarter, the Bureau of Economic Analysis (BEA) reported on Thursday. The first-quarter growth number, the first of three estimates for the period, compares with analyst forecasts of about a 2.5pc gain. Personal consumption slowed to a 2.5pc annual rate in the first quarter from a 3.3pc pace in the fourth quarter, partly reflecting lower spending on motor vehicles and gasoline and other energy goods. Gross private domestic investment rose by 3.2pc, with residential spending up 13.9pc after a 2.8pc expansion in the fourth quarter. Government spending growth slowed to 1.2pc from 4.6pc. Private inventories fell and imports rose, weighing on growth. The core personal consumption expenditures (PCE) price index, which the Federal Reserve closely follows, rose by 3.7pc following 2pc annual growth in the fourth quarter, although consultancy Pantheon Macroeconomics said revisions to the data should pull the index lower in coming months. The Federal Reserve is widely expected to begin cutting its target lending rate in September following sharp increases in 2022 and early 2023 to fight inflation that surged to a high of 9.1pc in June 2022. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Australia's MinRes posts higher 1Q spodumene output
Australia's MinRes posts higher 1Q spodumene output
Singapore, 25 April (Argus) — Perth-based major lithium and iron ore producer Mineral Resources (MinRes) has reported higher total spodumene concentrate output from its sites in January-March, and higher spodumene prices later in the quarter. Total attributable spodumene concentrate production of the firm across its assets rose to 170,000 dry metric tonnes (dmt) (see table for detailed breakdown), up by 3.7pc on the quarter and by 63pc on the year, according to the firm's latest quarterly activity report. Total attributable spodumene concentrate shipped volumes fell by 2.9pc on the quarter but rose by 50pc on the year to 166,000dmt. MinRes has an ambitious target of 1mn t/yr of lithium attributable within the next four years, said its managing director Chris Ellison last month during the firm's half-year results presentation. The firm has been aggressively expanding, several delegates told Argus at the Tribeca Future Facing Commodities conference held in Singapore on 26 March. The firm last month agreed to buy fellow developer Poseidon Nickel's concentrator plant in Western Australia as it seeks to retrofit it for lithium processing. MinRes' Mount Marion site saw higher output, driven by higher plant utilisation and improved ore recoveries as the firm continues to advance its plant improvement initiatives. The realised price for spodumene concentrate out of its Mount Marion site was at $718/dmt on a 4.2pc-grade basis, which was above the product's year-to-date fob costs of A$518/dmt ($338/dmt). The realised price translates to $1,048/dmt for 6pc-grade lithium concentrate (spodumene), said the firm. The firm did not process the spodumene concentrate produced from its Wodgina site during the quarter into lithium battery chemicals, citing "prevailing pricing dynamics", but instead resumed spodumene concentrate spot sales. The realised spodumene concentrate price at the site came in at $974/dmt on 5.6pc-grade basis, which translates to $1,028/dmt for 6pc-grade lithium concentrate (spodumene). The lithium battery chemical realised price, excluding value added tax, came in at $11,098/t. MinRes in November 2023 finalised the acquisition of the Bald Hill lithium mine from Alita Resources. January-March was the mine's first full production quarter, hence output was dragged down by limited availability of higher-grade feed, but this is expected to recover in April-June, said the firm. The realised spodumene concentrate price at the Bald Hill site was $878/dmt on 5.1pc-grade basis, which translates to $1,016/dmt for 6pc-grade spodumene concentrate. Argus -assessed prices for 6pc grade spodumene concentrate dipped to $1,080-1,180/t cif China on 23 April, from $1,100-1,200/t cif China a week earlier. Salts producers reduced spodumene bid prices because of a fall in salts prices two weeks earlier. By Joseph Ho MinRes lithium performance Jan-Mar '24 Oct-Dec '23 Jan-Mar '23 Spodumene concentrate production (k dmt) Mt Marion (50pc attributable basis) 91 83 60 Wodgina (50pc attributable basis) 49 55 44 Bald Hill (100pc attributable basis) 30 26 NA Total 170 164 104 Spodumene concentrate shipments (k dmt) Mt Marion (50pc attributable basis) 76 86 62 Wodgina (50pc attributable basis) 64 65 49 Bald Hill (100pc attributable basis) 26 20 NA Total 166 171 111 Lithium battery chemical (t) Wodgina production (50pc attributable basis) 6,793 6,798 3,246 Wodgina sales (50pc attributable basis) 6,954 6,474 1,504 Source: MinRes MinRes previously owned 40pc of the Wodgina project, which increased to 50pc starting from 18 October 2023. Figures for Wodgina before 18 October 2023 were on 40pc attributable basis. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
EV demand slowdown cuts S Korea’s LGES' profit in 1Q
EV demand slowdown cuts S Korea’s LGES' profit in 1Q
Singapore, 25 April (Argus) — South Korea's top battery manufacturer LG Energy Solution (LGES) reported significant lower revenue and profit in January-March, because of lower battery metal prices and slower electric vehicle (EV) demand. LGES' revenue in January-March fell by 23pc on the quarter and 30pc on the year to 6.13 trillion won ($4.46bn), owing to lower demand for EV pouch cells and energy storage system (ESS), with "prolonged metal price impact" affecting its average selling price. The firm reported W157bn of operating profit in January-March, but would have reported an operating loss of W32bn if it did not receive almost W189bn in US Inflation Reduction Act (IRA) tax credits. But this was still a sharp drop from W633bn of operating profit for January-March 2023. The lower revenue and a demand slowdown in the EV market led to utilisation rate adjustments that weighed on its financial performance. The firm reaped a net profit of W212bn during the quarter, which was up by 12pc on the quarter but down by around 62pc on the year, likely significantly propped up by the US' IRA tax credits. LGES said it will continue to invest despite the difficult market environment, but will "adjust" the size of its capital expenditure and execution speed "as per priority". Battery project updates LGES and automaker General Motors in early April completed the first battery shipment out of their second Ultium battery cell factory in US' Tennessee. The plant's capacity is expected to gradually expand to 50 GWh/yr, said LGES. Construction progress at the firm's battery manufacturing complex in US' Arizona is also on track, said the firm. Ramped up capacity is expected to be 53 GWh/yr, which will comprise 36 GWh/yr of 46-series cylindrical battery for EVs and 17 GWh/yr of lithium-iron-phosphate battery for ESS. LGES' 10 GWh/yr Indonesian battery production joint venture with South Korean conglomerate Hyundai Motor has also started mass production. Its battery module production joint venture with automaker Stellantis in US' Ontario, which encountered a halt in construction in May last year, will start operations in the second half of 2024. The factory has a planned capacity of 45GWh/yr and was supposed to begin operations early this year. LGES earlier this year inked a second agreement with Australian firm Wesfarmers Chemicals, Energy and Fertilisers for lithium concentrate supply. The firm will continue building a raw materials supply chain within regions that have a free trade agreement with US, it said. By Joseph Ho Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more