China steel sector looks to gains from monetary easing
The Chinese government's 7 October move to add more stimulus to the economy, by freeing up banks' ability to lend more, could support the steel sector by pushing credit into the key real estate and manufacturing consuming sectors. Around 60pc of China's steel is consumed by construction projects, including real estate and infrastructure.
The People's Bank of China (PBOC) cut the statutory cash reserves banks have to hold by 1pc, releasing fresh liquidity of 750bn yuan ($108bn) in the banking system. China has put on hold for now its drive to rein in the excessive debts of provinces and corporations on hold, focusing on fiscal and monetary stimulus to contain the fallout of growing trade frictions with the US.
The monetary easing is also poised to weaken the yuan further versus the US dollar, which could support China's steel exports as it buoys yuan-denominated earnings of exporters.
The reserve ratio cut comes on top of Beijing's pledge to speed up infrastructure investments in the second half of the year.
"We will vigorously support the construction of major projects identified by the central government and strengthen the weak links in economic and social development," China's finance minister Liu Kun told state-run media yesterday. The minister said additional tax cuts are being planned to stimulate consumption in the economy on top of an estimated Yn1.3 trillion in tax reduction this year.
But provinces are reluctant to step up borrowing for major infrastructure projects after two years of pressure from Beijing to reduce their debts, Singapore-based DBS Bank said in a report. Intended infrastructure investments during January-August contracted by 35pc from a year earlier, the bank said, based on analysis of Chinese national bureau of statistics data.
"The transmission of looser liquidity may need more time to have effect on real activities," DBS said. Lending to the corporate sector too remains slow as rising loan defaults have made banks wary, it added. Easing loans to smaller companies was cited as a key reason for cutting the reserve ratio by the PBOC central bank.
The steel sector has performed robustly this year, although price gains for construction steel have outpaced those in flat steel products. Growth in real estate investment and new project start-ups has been over 10pc against a year earlier for most of 2018, largely on property development in smaller Chinese cities. These growth rates may slow in the fourth quarter but will possibly still remain quite high.
Manufacturing sector growth has been stable, with slower growth in key steel consuming sectors such as automobiles and equipment manufacturing over the past couple of months. Import taxes on almost half of China's $500bn exports to the US is expected to pressure manufacturing growth in the short term, although looser monetary policies and accelerated spending will offer support.
The IMF has forecast China's economic growth to slow to 6.6pc this year from 6.9pc in 2017 and hit 6.2pc in 2019. A large part of the slowdown is the result of the US-China trade friction. The IMF expects China's monetary and fiscal actions to substantially offset the negative effects of the tariffs on Chinese products, although it may increase financial imbalances in the economy.
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China's Hunan Yuneng to build Spain battery LFP plant
China's Hunan Yuneng to build Spain battery LFP plant
Beijing, 24 April (Argus) — Chinese battery cathode producers have continued to expand investment in the overseas market, with the country's largest lithium iron phosphate (LFP) producer Hunan Yuneng planning to build a plant in Spain. Yuneng plans to invest 982mn yuan ($135.5mn) to build a 50,000 t/yr LFP production plant in Spain's Extremadura region. The firm aims to complete the site construction in 15 months after obtaining approval from the authorities. It will establish a subsidiary Yuneng International (Spain) New Energy Battery Material to develop this project. It did not disclose more details such as the launch dates. "This project is to strengthen the company's position in the global market and meet demand from overseas consumers, on the back of growing demand for LFP cathodes in the overseas market driven by the development of new energy vehicles outside China, especially in Europe," Yuneng said. Yuneng produced 504,400t of LFP cathodes in 2023, up by 50pc from a year earlier, with sales also rising by 56pc to 506,800t over the same period. It has achieved a nameplate capacity of 700,000 t/yr for LFP as of the end of 2023. It is also expanding capacity for another emerging battery cathode material, lithium manganese iron phosphate, which has higher energy density and allows for a longer driving range in electric vehicles (EVs), better performance in winter temperatures, and has lower manufacturing costs compared with LFP. Overseas expansions A growing number of Chinese battery cathode firms have accelerated their investment in overseas production projects, such as in France, Morocco and South Korea , to diversify resource origins and meet market entry conditions to the US required by the Inflation Reduction Act, and to cope with restrictions on key battery materials in the EU's Critical Raw Materials Act. Argus forecasts total demand for EV battery cathode material will reach 7.7mn t by 2034, from only 1mn t in 2022, with LFP expected to continue to take up the bigger share compared with ternary battery cathodes. Argus -assessed costs for cathode active material LFP were $13.95/kwh on 23 April, up from $12.31/kwh at the start of this year. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Inversión en autos eléctricos en México crecerá
Inversión en autos eléctricos en México crecerá
Mexico City, 23 April (Argus) — Las inversiones en México en ensamblaje de vehículos eléctricos (EV) y cadenas de suministro alcanzaron un máximo histórico en 2023 y se espera que crezcan en 2024, a pesar de una reciente desaceleración de la demanda global de EV y las próximas elecciones presidenciales. Se realizaron 96 inversiones en México durante 2023 en vehículos eléctricos y gastos relacionados con la electromovilidad, que alcanzaron los $5,600 millones, según el último informe de electromovilidad de la empresa mexicana de investigación Directorio Automotriz (DA). La empresa espera que esto se expanda en 11pc a $6,200 millones en 2024. Las expectativas de crecimiento global se han moderado para los vehículos eléctricos, pero DA señaló que la trayectoria sigue siendo positiva con proyecciones para las ventas globales de EV en 13.3 millones de unidades vendidas este año frente a los 9.6 millones vendidos en 2023. El año comenzó con varios anuncios de inversión. En febrero, Volkswagen dijo que invertirá $942 millones en su centro de electromovilidad de Puebla para agregar producción de EV. Magna, una empresa de piezas estructurales de EV, invertirá $166 millones para suministrar el complejo de General Motors en Ramos Arizpe, Coahuila. Seojin Mobility de Corea planea una inversión de hasta $260 millones para una planta de montaje de motores eléctricos en Escobedo, cerca de Monterrey, Nuevo León, con planes de completarla en febrero de 2025. Hay más anuncios de inversiones relacionadas con los vehículos eléctricos en el horizonte a finales de este año para empresas chinas como BYD, el principal competidor global de Tesla, así como Chirey Motors y SAIC, afirmó DA. El factor político El momento político en el país es importante, con elecciones presidenciales el 2 de junio y leyes electorales que limitan la participación de funcionarios gubernamentales en cualquier anuncio de inversión importante o evento relacionado desde el 1 de marzo. La perspectiva de la fabricación de automóviles chinos en suelo mexicano también está provocando nerviosismo entre los grupos comerciales estadounidenses que afirman que las empresas chinas están utilizando México como centro de representación para evitar aranceles. Aunque EE. UU. tiene un arancel de 27.5pc sobre los vehículos eléctricos chinos, incluso si se fabrican en suelo mexicano, las importaciones desde México de EV construidos con piezas chinas solo pagan un arancel de 2.5pc. "Pekín ya está utilizando a México como puerta trasera para eludir los aranceles de las importaciones a EE. UU. y está siguiendo el mismo plan de juego que casi destruyó las industrias del acero y solar de EE. UU.", dijo la Alianza para la Fabricación Estadounidense (AAM, por sus siglas en ingles) en un informe a finales de febrero. La presión sobre el gobierno de EE. UU. para tomar medidas está aumentando, con la presidencia y muchos asientos del congreso en juego en las elecciones de noviembre. A finales de 2023, en México había 262 empresas registradas relacionadas con el ensamblaje, la producción y la venta de vehículos eléctricos, según DA. Esta cifra se expandió en 19.6pc solo en los últimos cuatro meses, de acuerdo con la misma información. México podría producir 214,040 vehículos eléctricos en 2024, un aumento de 96pc comparado con 2023, luego de un crecimiento de 38pc el año pasado en 2022, estima DA. El principal anuncio hasta la fecha relacionado con los vehículos eléctricos en México sigue siendo el que hizo Tesla el 1 de marzo. La Gigafactoría México podría atraer hasta $15 mil millones, incluyendo inversiones adicionales. Pero el progreso en la Gigafactoría ha sido lento, luego de que Tesla no participó en una ceremonia en febrero, organizada por el gobernador del estado. Grupos ecologistas también se han quejado de su posible impacto en el suministro de agua en la región propensa a la sequía. Aunque la inversión en vehículos eléctricos está ganando terreno debido a factores como el nearshoring (relocalización de las cadenas de suministro más cerca de los mercados finales), no se garantiza un crecimiento continuo. La agencia de calificación Moody's ha mencionado recientemente una desaceleración global en inversiones como en las calificaciones de Nemak de México, líder en la fabricación de carcasas y soportes de aluminio para baterías de litio utilizadas en vehículos eléctricos. Mientras tanto, las ventas nacionales de vehículos eléctricos e híbridos en México continúan expandiéndose, subiendo en 75pc año tras año hasta 7,442 en enero, representando 6.6pc de todas las ventas nacionales de automóviles en el mes, según los datos de la agencia de estadísticas Inegi. Por James Young Planes recientes de inversión en EV y electromovilidad en México Anunciado Compañía Proyecto Inversión Ubicación Feb 23 Stellantis Producción de la van de carga EV RAM ProMaster 200 Saltillo, Coahuila Marzo 23 Tesla and OEM suppliers Tesla Gigafactoría e inversiones asociadas 15,000 Santa Catarina, Nuevo Leon Marzo 23 Jetour Planta de ensamblaje de vehículos híbridos y de combustión interna 3,000 Ramos Arizpe, Coahuila Feb 24 Volkswagen Centro estratégico para EV 942 Puebla Marzo 24 Magna Agregar dos divisiones para partes de EV 166 El bajío Marzo 24 BMW Construir planta de ensamblaje de baterías para EV 849 San Luis Potosí Marzo 24 Seojin Mobility Construir planta de motores para EV 260 Sonora Abril 24* ZF Group Centro de I+D en electromovilidad 200 Monterrey, Nuevo León — Anuncios de la compañías *Abierto Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Hydro invests in metal recycling plant at Hoyanger
Hydro invests in metal recycling plant at Hoyanger
London, 22 April (Argus) — Norwegian aluminium producer Hydro has invested 240mn kroner ($21.8mn) in a new recycling facility alongside its primary aluminium smelter in Hoyanger, Norway. The recycling plant will process 36,000 t/yr of post-consumer aluminium scrap, as Hydro moves towards its 2030 target of reducing its emissions by 30pc compared with 2018 levels. The new facility will process scrap metal from vehicles, building facades, furniture, packaging and other consumer goods, which will be mixed with primary metal made with renewable hydropower at the Hoyanger plant. Among Hydro's low-carbon aluminium products is the Circal brand of aluminium, which is made with 75pc recycled content, and the Reduxa brand, which is made with renewable energy and generates emissions of less than 4kg CO2/kg aluminium produced. They are key to the company's emission reduction targets and ultimately reaching net zero by 2050. "Recycling is the fastest way to zero. With this new facility, we deliver on our strategy to increase recycling capacity in our efforts to decarbonise our own production processes and make products that the world needs for the green transition," the executive vice-president of Hydro's aluminium metal business, Eivind Kallevik, said. By Jethro Wookey Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Baltimore opens third temporary shipping channel
Baltimore opens third temporary shipping channel
New York, 22 April (Argus) — A third temporary shipping channel has opened at the Port of Baltimore to allow more vessel traffic around the collapsed Francis Scott Key Bridge. Located on the northeast side of the main channel, the new passage has a controlling depth of 20-ft, a 300-ft horizontal clearance, and a vertical clearance of 135-ft. When combined with two other temporary channels opened earlier this month the port should be able to handle "... approximately 15 percent of pre-collapse commercial activity," said David O'Connell, the federal on-scene coordinator. The main shipping channel of the Port of Baltimore — a key conduit for US vehicle imports and coal exports — is expected to be reopened by the end of May, the Maryland Port Administration said earlier this month. The bridge collapsed into the water late last month when the 116,851dwt container ship Dali lost power and crashed into one of its support columns. Salvage teams have been working ever since to remove debris from the water and containers from the ship in order to clear the main channel. By Stephen Cunningham Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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