Steel
Overview
The price indices in our Argus Ferrous Markets and Argus Global Steel services are widely used by companies in physical supply contracts around the world – for iron ore, coking coal, hot-rolled coil (HRC) and ferrous scrap.
Many of them are used as the settlement prices for cash-settled futures contracts launched by exchanges to allow users of the derivatives who also transact in the physical market to minimize basis risk while hedging. These cash-settled monthly futures contracts are settled against the arithmetic mean of all the published Argus prices during each calendar month.
Using indices allows companies to trade material on an index-linked basis, not only via fixed-prices sales. This offers significant advantages when prices are volatile, yet the modern finished steel market remains primarily transacted on a fixed price basis. The addition of futures markets offers opportunities to enhance supply chain resilience further.
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Latest steel news
Viewpoint: New mines to raise BHP, Rio iron ore grades
Viewpoint: New mines to raise BHP, Rio iron ore grades
Sydney, 23 December (Argus) — UK-Australian mining firm Rio Tinto expects production from its new Simandou mine in Guinea to lift its overall iron ore grades in the coming years, while the ramp-up of fellow resources firm BHP's Samarco mine in Brazil could produce similar results. Rio Tinto's average realised iron ore grade fell to a decade low of about 60.5pc this year, data from its 2025 Capital Markets Day presentation show. But the company expects the high-grade Simandou mine in Guinea to increase its average product ore grades to around 61.7pc by 2032. The company downgraded the specification of its Pilbara Blend fines ore from 61.6pc Fe to 60.8pc Fe in May. It also increased its sales of lower-grade SP10 ore, which has lower iron and higher impurity levels, over 2024. BHP is in a similar situation to Rio Tinto. The company's typical Australian ore grades have declined over recent years, dropping below 62pc Fe. But increased production at the higher-grade Samarco operations in 2025 likely supported its overall ore grades. BHP has not announced any longer-term ore grade forecasts. But a planned increase in its Samarco production, which it expects to average 67pc Fe in the current financial year, is likely to boost grades. Simandou Rio Tinto opened Simandou in November and shipped its first load of ore in early December. It will increase production at the site to 60mn t/yr — equivalent to about 18pc of its 2024 Western Australian ore output — by 2028. The company expects to sell 5mn-10mn t of high-grade ore from the mine in 2026, before ramping up production to 60mn t/yr by 2028. Simandou will account for about 15pc of Rio Tinto's total output at that stage, with production from the company's increasingly mid-grade Pilbara mines and Canadian plants accounting for the rest. Samarco BHP aims to produce 7mn-7.5mn t of 67pc Fe ore pellets at Samarco during the 2025-2026 financial year to 30 June, before ramping up capacity to 30mn t/yr by 2028. The company's entire equity-basis production growth in July-September came from Samarco. It produced 2.1mn t of ore over the quarter, up from 1.3mn t a year earlier. The Samarco ramp-up should lift BHP's average iron ore grade over the next few years, despite the Pilbara grade declines. Samarco will also diversify BHP's customer base. Close to 90pc of its major Australian iron ore shipments went to China in 2024, estimates from marine tracking platform Kpler show, making it vulnerable to economic and policy changes in the country. But Samarco's 2024 sales were split between the Middle East and Africa, Asia, Europe, and the Americas. A third of the mine's customers were in the Americas, with another quarter in Africa and the Middle East, according to Samarco's 2024 financial statement. Grade gains BHP and Rio Tinto offset grade declines at their Pilbara mines in 2025 by selling more lump and fewer fines . This has helped the companies maintain stable realised prices despite falling iron ore grades. But this trend is being driven by what are potentially temporary demand-side factors. Chinese steelmakers began to favour lower-grade lump this year because of concerns about sintering restrictions. This is not guaranteed to continue. Instead, Rio Tinto and BHP's overseas mines could provide a more stable path to offsetting grade declines than increasing lump sales, given uncertainty over demand. By Avinash Govind Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
Viewpoint: Price battle pushes Brazil HRC lower in 2025
Viewpoint: Price battle pushes Brazil HRC lower in 2025
Sao Paulo, 22 December (Argus) — Brazilian hot-rolled coil (HRC) prices declined throughout 2025, despite solid economic growth and steady demand in most sectors, with prices ending the year lower because of pricing competition between domestic and imported HRC. Argus - assessed imported HRC cfr Brazil dropped to $515-550/metric tonne (t) on 11 December, down from $535-555/t on 2 January. Argus -assessed HRC ex-works fell to R3,600-3,900/t ($655.80-702.80/t) in the latest assessment compared with R4,000-4,300/t at the start of the year. Brazilian mills resisted pressure from a rising influx of lower-priced imports stemming from an oversupply in China, holding prices steady for the first five months of the year. But mills yielded to price cuts in June, when price spreads were as much as 38pc higher than imports. Buyers were able to secure deals below R3,400/t in July, market participants told Argus . Tighter safeguard measures around the world and anti-dumping actions targeting Chinese material helped redirect steel to countries with looser trade defenses, including Brazil. Imports hit an all-time high of 6mn t in the year through Novembe r , up by 7pc from the same period last year, industry chamber Aço Brasil said. These volumes added to domestic production and boosted apparent consumption — the sum of production and imports minus exports — by 2.5pc to 24.8mn t year-to-date November. Service centers and trading companies took advantage of the lower import prices to build up their inventories. High stock levels ultimately weighed on demand and dragged down offer levels. Domestic and import sellers were forced to slash prices in June to spur buying interest in an already oversupplied market. Import HRC prices slipped below $500/t in July. Sales up The Brazilian real strengthened by 14.2pc against the dollar year-to-date mid-December, boosting import competitiveness for 2025. Imports offered another advantage beyond pricing: lower financial costs from international trading firms. Brazilian mills rarely operate on credit, and even if they did, borrowing costs in Brazil reached their highest level in 20 years in 2025. Brazil's 15pc target interest rate, which spurs higher commercial lending rates, has dampened end-user demand, but not enough to slow steel consumption significantly. Despite the rising import flows, domestic sales remained stable on the year at 19mn t year-to-date November, Aço Brasil said. Full-year 2025 domestic sales are expected to match the high-21mn t level of a year earlier, which was the highest since a demand surge during the pandemic. Brazil's gross domestic product grew by an annualized 2.7pc through September, Brazil's statistics bureau IBGE said, on track to beat the central bank's full-year growth forecast of 2.25pc. The solid economic growth has supported steel demand, especially in the construction and automotive sectors. Real estate construction starts jumped to 307,366 units year-to-date September, up by 8.4pc compared with the same period in 2024, the Brazilian construction industry chamber (CBIC) said. Real estate sales rose 4pc to 312,240 properties over the same period, CBIC data show. The Minha Casa Minha Vida low-income housing program accounted for nearly half of both sales and new units. Brazil produced 2.46mn vehicles in January-November, up by 4.1pc year-on-year, automaker association Anfavea said. Registrations rose 1.4pc to 2.1mn units over the same period, while automobile exports surged by 39pc to 510,130 units, driven by higher shipments to Argentina, Colombia and Chile. The annual drop in HRC prices in Brazil was driven less by demand and more by fierce competition between domestic producers and import suppliers, which pushed prices lower despite stable consumption. Brazilian HRC prices are expected to remain under pressure in early 2026 as high inventories and competitive import offers persist, a trader said. A modest recovery is expected in the second half of the year, depending on stronger domestic demand and potential trade defense measures, market participants told Argus . By Isabel Filgueiras Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
Viewpoint: Indonesia’s MHP surge to hit nickel prices
Viewpoint: Indonesia’s MHP surge to hit nickel prices
Singapore, 19 December (Argus) — Indonesia is likely to expand its mixed-hydroxide-precipitate (MHP) plant capacity further in 2026, supported by record-high cobalt prices and strong production economics, a move that could deepen nickel oversupply and weigh on prices. Current output Indonesia's MHP output is projected to reach 482,000t in nickel metal equivalent this year — almost a 50pc rise from 2024, according to Argus estimates. Argus -assessed 37pc nickel payable MHP prices have fallen by 2.6pc on the year to $127.40/metric tonne unit (mtu) so far in 2025, while Class 1 nickel prices have dipped from $17,000/t to around $15,350/t over the same period. Nickel prices will likely remain depressed in the low-$15,000s/t range in 2026 because supply expansion is outpacing demand growth. Demand has slowed as the electric vehicle (EV) market growth has cooled in recent years, with annual growth in global EV car sales slowing from 26pc in 2024 to 23pc in 2025. Nickel demand growth could also face further headwinds from increasing competition from other battery types such as nickel-free lithium-iron-phosphate and high-manganese chemistries. This could increase the nickel surplus, further weighing down on overall nickel prices. Indonesia has consolidated its position as the leading global MHP supplier after most Western plants halted operations in late 2023. The country currently hosts around 10 operating MHP projects with a combined designed capacity of about 440,000 t/yr of nickel. Most projects are owned by Chinese giants Ningbo Lygend, Green Eco-Manufacture (GEM), and Huayou, in collaboration with local producers Merdeka, Harita Nickel, and PT Vale Indonesia (PTVI). MHP capacity expansion More MHP projects are expected in the near-term, bolstered by elevated cobalt prices, as MHP typically contains 2-5pc of cobalt. Refineries have been seeking cobalt alternatives because of constrained supply following export restrictions imposed by the Democratic Republic of Congo (DRC) since February. Indonesia's cobalt feedstock capacity is projected to hit around 65,000 t/yr in 2026, while global cobalt supply is expected to hit 210,000t over the same period, according to Argus data. The lucrativeness of MHP in comparison with other nickel products, such as nickel pig iron (NPI), is another driver for investment. MHP production cost: $10,500–11,000/t (December estimate) Processing cost to convert MHP into nickel metal: $3,000–3,500/t Total cost for MHP to nickel metal: $13,500–14,500/t NPI to nickel metal cost: $14,000–14,500/t Additionally, cobalt by-product sales (around $2,000/t) help offset MHP production costs, effectively reducing net costs to $11,500–12,500/t, making MHP more lucrative than NPI. Outlook Concerns are mounting that rapid expansion of Indonesia's MHP capacity will further pressure on nickel prices. Argus forecasts Indonesia's MHP capacity to nearly double on the year to 862,000 t/yr in 2026, as several HPAL projects are scheduled to be commissioned in 2026. While not all capacity will translate into production, any additional output will add to an already oversupplied market, intensifying the glut. The overall nickel surplus is estimated at 212,000t in 2025 and is projected to reach 288,000t in 2026, according to Argus data. Indonesia has tightened its efforts to regulate nickel pricing and oversupply this year, reverting the validity period for RKAB mining quotas to one year. The government also suspended some nickel mines due to a lack of reclamation and post-mining guarantees, while lands were seized from Weda Bay Nickel and Tonia Mitra Sejahtera for lacking forestry permits. These policy changes have yet to significantly impact nickel prices, but remain critical factors that could disrupt supply and influence the price outlook. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
Traders offer CBAM paid import at discount to NW EU HRC
Traders offer CBAM paid import at discount to NW EU HRC
London, 18 December (Argus) — Some traders are starting to offer imported hot-rolled coil at varying discounts to Argus ' benchmark north EU HRC index inclusive of the carbon border adjustment mechanism (CBAM), suggesting they do not believe they will have to pay default values for the material. One trader was this week offering Indian HRC at a discount of €10/t to the monthly average of the Argus index for May 2026. Indian fixed-price cfr offers are around €470/t, while April is currently trading around €665/t on the CME Group's north EU HRC contract, for which Argus ' index is the cash-settlement basis. This suggests the trader believes it will not have to pay default values for the material; India's default value of 4.7t and the relevant benchmark of 1.37 would imply a CBAM cost of almost €270/t and an all-in cost of €740/t, assuming a carbon price of €80/t. Another trader reportedly offered Indonesian material at a steeper discount to the index for April arrival. Indonesia's default value of over 9t, against the benchmark of 1.37/t, would imply a carbon cost alone of over €617/t, suggesting it also assumes it will not pay the default value. The mill in question has informed market participants its direct emissions intensity is around 1.2t. The offers suggest, unsurprisingly, traders expect CBAM costs to be factored into the domestic market price, as reflected by Argus ' index. They also suggest traders believe domestic material will retain a premium to imports: at a recent Eurometal conference in Dusseldorf, some buyers suggested domestic material from one or two mills may in effect become the marginal tonne, as CBAM increases import costs. Increased complexity in importing — predominantly driven by CBAM and revisions to the EU safeguard — is steadily pushing the market towards buying on delivered duty paid terms, meaning buyers run no duty risk. This is typically being absorbed by traders. Most ddp offers have risen in recent weeks, in response to a flurry of leaked CBAM documents. Traders had been offering around €570/t ddp a few weeks back, but these offers have now mainly climbed to €600-620t ddp, reflecting more prohibitive default values and an expectation that prices will rise in the first quarter, enabling traders to book more profit. There was an offer reported yesterday at €585/t ddp Antwerp from Asia for April-May. The origin of the material was unclear, but some said it was from Vietnam. The rise in ddp offer volumes and prices has led to an increase in trading on the CME Group's north EU HRC contract in the last week or two. A 15,000t deal traded on 16 December for the fourth quarter of 2026 at €684/t, which derivatives traders said was likely an attractive buying price. Over the first three days of this week, around 36,700t traded on the CME contract, compared with just over 41,000t the whole of last week and 11,260t the preceding week. By Colin Richardson Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.