US steel imports set to extend drop in March
US steel imports are poised to fall in March by 13pc from a year earlier, the 10th straight monthly drop.
US steel imports in March declined to around 2.45mn metric tonnes (t), according to import license data from the US Department of Commerce. Licenses are filed with the intent of importing, but actual volumes can fluctuate.
March imports would be down from 2.81mn t imported in March 2022.
Driving the decline are flat products like hot rolled coil (HRC), which are set to fall by 40pc on the year to 145,500t. Imports of hot dipped galvanized (HDG) coil products could drop by 42pc to 166,600t, while cold rolled coil (CRC) imports are poised to fall by 42pc to 90,800t.
Imports of reinforcing bar (rebar) products could fall by 42pc to 85,100t in March. Wire rod imports are set to plunge by 73pc to 45,400t.
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Mexican power outages enter fourth day
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Mexico City, 10 May (Argus) — Mexican power grid operator Cenace issued its fourth consecutive day of operating alerts amid the heatwave gripping the country. Net electricity demand reached 47,321MW early today, with deployed electricity capacity slightly below at 47,233 MW, according to Cenace. Since 7 May, Cenace has declared emergency operating alerts as demand exceeded generation capacity during peak evening hours, prompting the grid operator to preemptively cut electricity supply across different states to maintain grid integrity. Power outages have lasted up to several hours in Mexico City and in major industrial states as power demand has outstripped supply by up to 1,000MW. Peak demand this week hit 49,000MW, just below last year's historic peak of 53,000MW during atypical temperatures in June. "We are very concerned about the unprecedented outages detected across 21 states, a situation that affects the normal functioning of Mexican companies," national business chamber Coparmex said. Peak electricity demand typically rises in June-July but temperatures this week have risen as high as 48°C (118° F) across some states. Mexico City reported a record high of 34.3°C on 9 May and high temperatures are forecast to continue into next week, Mexico's national weather service said. The inability of Mexico's grid to respond to increased demand is because of insufficient power generation capacity, non-profit think-tank the Mexican institute for competitiveness (Imco) said this week. "Despite the energy ministry's forecast that 22,000MW of new power capacity would enter service by 2026, only 1,483MW had entered service as of 2022" since late 2018, Imco said. President Andres Manuel Lopez Obrador's administration pledged to build new generation capacity, including five gas-fired, combined-cycle plants, but recognized this week that delays had contributed to the power outages. "We have an electricity generation deficit because some of the combined-cycle plants were delayed, but we are working on it and it will soon be resolved," Lopez Obrador said on 9 May. Lopez Obrador's government has also curtailed private sector power development during his administration. Mexico needs to upgrade and expand its transmission network, industry associations say. "In order to resolve this problem, we believe that a reopening of the electricity market to the private sector is imperative," Mexico's wind energy association, Amdee, said. Mexico has 87,130MW of installed capacity, with 39.5pc from combined-cycle gas-fired power plants and 31pc in renewable power, including wind, solar, hydroelectric, geothermal and biomass, according to the latest statistics from the energy ministry. By Rebecca Conan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Tata Steel UK unions vote to strike
Tata Steel UK unions vote to strike
London, 9 May (Argus) — Workers at Tata Steel's Port Talbot plant in south Wales have voted to strike in response to the company's plan to stop iron-making and cut thousands of jobs. Over 3,000 members of Community Union have been balloted, with more than 85pc in favour of industrial action — this is despite the company threatening to withdraw its proposed support package in the event of strikes. "It should be noted this resounding mandate has been delivered in spite of the company's bullying and unacceptable threats to slash redundancy payments," Alun Davies, Community's national officer for steel, said. He urged Tata to "get back around the table" to prevent a major industrial dispute. Workers at Unite the union have already voted in favour of strike action, which is set for 30 May. Unions — and the Syndex consultancy that has represented them in talks with Tata — have called the company's agreement with the government a "bad deal". They have requested more financial support to help Tata with decarbonisation, and for a blast furnace to be maintained. The government is giving Tata £166/t towards its decarbonisation — less than many European competitors receive from their governments. The low level of state support played into Tata's decision to move to one large electric-arc furnace, which has been roundly criticised by unions. By Colin Richardson Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Turkey's new EAF capacities to trigger scrap shortage
Turkey's new EAF capacities to trigger scrap shortage
London, 9 May (Argus) — More companies will invest in electric-arc furnaces (EAFs) as part of their green transition, which will likely result in more demand for scrap amid tighter scrap supply in the medium term, market participants said at an industry conference in Istanbul today. The shift toward EAF production globally is set to boost scrap consumption, and could limit the availability of scrap for export markets. The majority of Turkish steel production is EAF based, with most new capacities coming on line also scrap-based. Potential legislative changes, such as those proposed in the UK to restrict scrap exports and protect local supplies, could further tighten the market supply. Such restrictions, coupled with rising scrap consumption, could intensify competition. Major steel producers in the EU and the UK are also transitioning to EAF production, significantly increasing their domestic scrap demand, resulting in suppliers focusing less on exports. Turkey has traditionally relied on imported scrap. Turkey should explore integrated production methods and consider hydrogen-based steel production systems, the general manager of Cag Celik Ercument Unal said. Adopting direct-reduced iron (DRI) technology would reduce the need for scrap, but will increase the demand for iron ore. Turkish steel producer Tosyali Holding anticipates globally hydrogen-based methods will account for 22pc of total steel production by 2050, following scrap-based methods, which are expected to contribute 40pc. There were no major changes in the steel production methodology in the past 50 years, except for some developments in automation and minor energy savings. However, current developments in hydrogen use will be more significant, Tosyali said. Tosyali recently completed its second DRI plant at its Algeria site and is currently building a third DRI, which will use 100pc hydrogen in production. "Every investment we make today regarding the green transition will be more economical than the trade measures we will face tomorrow," Tosyali chairman Fuat Tosyali said. Turkey has great potential for solar energy to produce hydrogen, director of Huawei Smart PV Turkey Eray Hazer said. One of the major Turkish mills bought 1GW of capacity, but this is only enough to cover 10-15pc of its production, so in order to generate enough electricity to run the DRI, higher solar power installation is required. There are a number of risks which can affect the Turkish steel industry, South Korean steelmaker Posco research and development deputy manager Dr Kisoo Kim said during the conference, including reduced exports due to the implementation of the EU's Carbon Border Adjustment Mechanism (CBAM), rising scrap demand causing supply shortages, and notably high output costs to produce green electricity. The latter could be eased by considering the nuclear power option as a bridge solution if public approval is achieved, he added. By Elif Eyuboglu Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Jakarta forum calls for exploring Ni price references
Jakarta forum calls for exploring Ni price references
Singapore, 9 May (Argus) — The global nickel market should explore different price references for nickel products to reduce price uncertainty, panellists said at the Third Nickel Producers, Processors and Buyers Conference in Jakarta, Indonesia. The London Metal Exchange (LME) nickel price, which is the global benchmark for class 1 nickel products, has been volatile for years now since LME suspended nickel trading in early March 2022, when prices surged above $100,000/t overnight. There were hopes late last year that prices would become more stable this year. But the price outlook has been uncertain since the turn of the year, with class 1 prices on the London Metal Exchange (LME) slumping to a four-year low of $15,877.50/t on 6 February on expectations of weak Chinese stainless steel and electric vehicle demand, before rebounding to a six-month high of $19,387.50/t on 26 April because of a delay in Indonesian RKAB mining right approvals and a reviewed forecast suggesting a significant smaller surplus for this year. There should be a new reference to counter price volatility, some conference participants said, while others suggested decoupling class 1 and 2 nickel prices. "[Prices are volatile now because] most prices are referenced to class 1, so maybe we can explore further with more price references, like class 2 nickel pig iron (NPI) and mixed hydroxide precipitate (MHP)," Ray Gunara, president-director of Indonesian coal producer Harum Energy, said on 7 May. Harum Energy this year bought a majority stake in an Indonesian nickel processing and refining business. Most conference participants agreed that a different price reference would help maintain nickel price stability. "[NPI prices now are] difficult to predict because the class 1 [prices] are no longer linked to the product we are selling," Indonesia miner Trimegah Bangun Persada (Harita Nickel)'s president-director Roy Arman Arfandy said. Indonesia is the world's largest nickel producer. The correlation between the monthly average of the LME class 1 cash official price and Argus ' NPI ex-works China index has fallen to close to 0.41 between January and May, from 0.91 in 2023. The correlation between the LME class 1 cash official price and Argus ' class 2 nickel benchmark Indonesian Nickel Index (INI) for 10-14pc NPI fob Indonesia was 0.52 between January and May. Market participants at the conference also expressed hope for more government support. "Currently there is an imbalance between local and foreign investments, so we are hoping that the government can give more support to local players like us," one producer said. Another conference participant said that they would aim to build a precursor cathode active material plant if given more support. Argus ' class 2 nickel INI for 10-14pc NPI fob Indonesia stood at $118.70/mtu on 3 May. The INI for 37pc MHP was at $142.80/mtu fob Indonesia and 70pc matte was at $148.90/mtu fob Indonesia on the same day. By Sheih Li Wong Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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