Weak sentiment, higher prices dampen E Asian scrap buying
The scrap import market in east Asia is quiet this week with traders reporting to Steel Business Briefing that there has not been any recent buying of bulk scrap shipments. Last week, two cargoes of HMS 1 from west coast, USA for December shipment were booked at $329/tonne cfr Korea. Trading sources say that Korean importers may have held off further buying after that booking because sentiment was negatively affected by Dubai's recent debt default problems. "The Dubai problem has caused sentiment to fall. The Koreans need more scrap," a regional trader says."I am very concerned myself about issues happening in Dubai because the world economy is very vulnerable now," a Southeast Asian scrap trader says. There are fewer offers of bulk scrap to the region because suppliers say that supply is tight. Limited bulk offers of 80:20 HMS 1/2 are heard at $340-350/t cfr but there are no takers. No recent import bookings have been heard in China, according to local trading sources. "Prices are too high," a local trader tells SBB. The last booking of US scrap concluded at $325/t cfr China for 80:20 HMS and $330/t cfr China for shredded. Meanwhile, containerised scrap is being offered this week at around $310-320/t cfr for 80:20 to Southeast Asia. Some material was booked at $310/t cfr Vietnam last week, local traders tell SBB. "Demand has slowed down because the regional mills are waiting out the current market. The year-end is approaching too," an importer says.
Scrap export role continues to drive US market
With all the speculation about whether US scrap prices will have one large price increase in December, or two smaller increases this month and next, market players are looking to whatever "real" indicators they can find. And US scrap export trends continue to be a critical factor. A market analyst added: "(Up) $30 a long ton (in December) is a good number.the strength is coming entirely from exports. Volumes are strong." He wondered if China and Turkey were getting ahead of the expected January price jump by buying in December "so that they don't have to in January. I don't think they have the same tax reasons for being out of the market as domestic producers do, so they probably don't mind sitting on inventory. and they love to fish for cheap prices." One mill source added, "We agree (there will be) upward bias on scrap prices for December, and maybe into January, although it will be interesting to watch whether the recent developments in Dubai will impact Turkey's consumption of scrap short-term." More than one market source said US shredded scrap is already selling for $280-290/l.t delivered to mills - even as much
as $300/l.t in the southern US market - about $35-40 above the last month's price. The south, where most of the country's minimills operate, seems to be the most active, one scrap procurer said. Meanwhile, in Asia, the market seems to be cooling, market sources tell SBB (see other story), at least in part because of the Dubai crisis.
China set to import 600m t of iron ore this year
China is on track to import almost 600m tonnes of iron ore this year, up 35% on the 444m t it imported in 2008, the country's Ministry of Industry & Information Technology (MIIT) said on Thursday. Between January and October this year China imported 514.8m t of iron ore, up 36.8% on the corresponding period in 2008. MIIT also forecast that China will produce 571m t of crude steel in 2009 compared with around 500m t last year. The huge increase in imported iron ore relative to the rise in steel production shows the extent to which imports have replaced domestic iron ore, Steel Business Briefing notes. For much of this year, when lower iron ore spot prices made it uneconomic to continue operating, a large number of domestic miners closed their doors. But rising spot prices and steel capacity being switched back on encouraged domestic miners to resume operating. In September, Macquarie Bank said 60% of previously mothballed domestic iron ore miners had reopened over the previous month. Prices of Indian 63.5% Fe hit $100/t at the end of July before dropping to around $85/t at the end of August. In 2008, China produced 824m t of iron ore concentrate, equivalent to 245m t at an average 30% Fe after processing. Total concentrate capacity by 2010 is likely to be 300-400m t/y.
The scrap import market in east Asia is quiet this week with traders reporting to Steel Business Briefing that there has not been any recent buying of bulk scrap shipments. Last week, two cargoes of HMS 1 from west coast, USA for December shipment were booked at $329/tonne cfr Korea. Trading sources say that Korean importers may have held off further buying after that booking because sentiment was negatively affected by Dubai's recent debt default problems. "The Dubai problem has caused sentiment to fall. The Koreans need more scrap," a regional trader says."I am very concerned myself about issues happening in Dubai because the world economy is very vulnerable now," a Southeast Asian scrap trader says. There are fewer offers of bulk scrap to the region because suppliers say that supply is tight. Limited bulk offers of 80:20 HMS 1/2 are heard at $340-350/t cfr but there are no takers. No recent import bookings have been heard in China, according to local trading sources. "Prices are too high," a local trader tells SBB. The last booking of US scrap concluded at $325/t cfr China for 80:20 HMS and $330/t cfr China for shredded. Meanwhile, containerised scrap is being offered this week at around $310-320/t cfr for 80:20 to Southeast Asia. Some material was booked at $310/t cfr Vietnam last week, local traders tell SBB. "Demand has slowed down because the regional mills are waiting out the current market. The year-end is approaching too," an importer says.
Scrap export role continues to drive US market
With all the speculation about whether US scrap prices will have one large price increase in December, or two smaller increases this month and next, market players are looking to whatever "real" indicators they can find. And US scrap export trends continue to be a critical factor. A market analyst added: "(Up) $30 a long ton (in December) is a good number.the strength is coming entirely from exports. Volumes are strong." He wondered if China and Turkey were getting ahead of the expected January price jump by buying in December "so that they don't have to in January. I don't think they have the same tax reasons for being out of the market as domestic producers do, so they probably don't mind sitting on inventory. and they love to fish for cheap prices." One mill source added, "We agree (there will be) upward bias on scrap prices for December, and maybe into January, although it will be interesting to watch whether the recent developments in Dubai will impact Turkey's consumption of scrap short-term." More than one market source said US shredded scrap is already selling for $280-290/l.t delivered to mills - even as much
as $300/l.t in the southern US market - about $35-40 above the last month's price. The south, where most of the country's minimills operate, seems to be the most active, one scrap procurer said. Meanwhile, in Asia, the market seems to be cooling, market sources tell SBB (see other story), at least in part because of the Dubai crisis.
China set to import 600m t of iron ore this year
China is on track to import almost 600m tonnes of iron ore this year, up 35% on the 444m t it imported in 2008, the country's Ministry of Industry & Information Technology (MIIT) said on Thursday. Between January and October this year China imported 514.8m t of iron ore, up 36.8% on the corresponding period in 2008. MIIT also forecast that China will produce 571m t of crude steel in 2009 compared with around 500m t last year. The huge increase in imported iron ore relative to the rise in steel production shows the extent to which imports have replaced domestic iron ore, Steel Business Briefing notes. For much of this year, when lower iron ore spot prices made it uneconomic to continue operating, a large number of domestic miners closed their doors. But rising spot prices and steel capacity being switched back on encouraged domestic miners to resume operating. In September, Macquarie Bank said 60% of previously mothballed domestic iron ore miners had reopened over the previous month. Prices of Indian 63.5% Fe hit $100/t at the end of July before dropping to around $85/t at the end of August. In 2008, China produced 824m t of iron ore concentrate, equivalent to 245m t at an average 30% Fe after processing. Total concentrate capacity by 2010 is likely to be 300-400m t/y.
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New Zealand extends AD duties on Thai, Malaysian imports
New Zealand's Ministry of Economic Development has decided to extend anti-dumping duties on imports of galvanized wire from Malaysia, and rebar and coil from Thailand for another five years. The duties have been in place since 2004 and will be extended until 2014, according to a sunset review concluded on 17 November. The ministry had imposed a 28% anti-dumping duty on rebar and coil imports (5-40mm in diameter) from Thailand, and a 15% ad valorem duty on galvanized wire imports from Malaysia. The review found a "risk of recurrence of dumping and material injury." In a statement sent to Steel Business Briefing, Pacific Steel general manager, Ian Jones, said the company had "no problem competing with fairly priced imports, but as our recent work has shown, we will vigorously defend our business against unfair trading behaviour." Auckland-based Pacific Steel is New Zealand's only producer of reinforcing bar and wire, and was the original complainant. It is a division of Fletcher Steel.
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China domestic iron ore prices stable
Despite weakening imported iron ore prices in China, the market for domestic iron ore is currently stable with transactions described as "healthy", Steel Business Briefing learns from market sources. The price of iron ore concentrates grading 66% Fe in Tangshan in Hebei province has remained at around RMB 737-749/wet metric tonne ($106-110/wmt). In the Hanxin region, also in Hebei, 66% Fe concentrate is priced at RMB959/dry metric tonne ($140/dmt) including VAT, also the same as the previous week. A major producer from Hanxin tells SBB that he hasn't seen any negative effects from the softening imported iron ore market yet, and says the current level of transactions is satisfactory. He predicts that the domestic iron ore market will remain firm in the short term as demand from mills is still good. Mills are also planning to lift their steel prices, which he believes will underpin higher prices. A trader from Qingdao in northern China says that mills' output has stayed at a high level, keeping demand for domestic iron ore relatively strong. But he says that demand is likely to reduce when mills begin their maintenance work in December.
New Zealand's Ministry of Economic Development has decided to extend anti-dumping duties on imports of galvanized wire from Malaysia, and rebar and coil from Thailand for another five years. The duties have been in place since 2004 and will be extended until 2014, according to a sunset review concluded on 17 November. The ministry had imposed a 28% anti-dumping duty on rebar and coil imports (5-40mm in diameter) from Thailand, and a 15% ad valorem duty on galvanized wire imports from Malaysia. The review found a "risk of recurrence of dumping and material injury." In a statement sent to Steel Business Briefing, Pacific Steel general manager, Ian Jones, said the company had "no problem competing with fairly priced imports, but as our recent work has shown, we will vigorously defend our business against unfair trading behaviour." Auckland-based Pacific Steel is New Zealand's only producer of reinforcing bar and wire, and was the original complainant. It is a division of Fletcher Steel.
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China domestic iron ore prices stable
Despite weakening imported iron ore prices in China, the market for domestic iron ore is currently stable with transactions described as "healthy", Steel Business Briefing learns from market sources. The price of iron ore concentrates grading 66% Fe in Tangshan in Hebei province has remained at around RMB 737-749/wet metric tonne ($106-110/wmt). In the Hanxin region, also in Hebei, 66% Fe concentrate is priced at RMB959/dry metric tonne ($140/dmt) including VAT, also the same as the previous week. A major producer from Hanxin tells SBB that he hasn't seen any negative effects from the softening imported iron ore market yet, and says the current level of transactions is satisfactory. He predicts that the domestic iron ore market will remain firm in the short term as demand from mills is still good. Mills are also planning to lift their steel prices, which he believes will underpin higher prices. A trader from Qingdao in northern China says that mills' output has stayed at a high level, keeping demand for domestic iron ore relatively strong. But he says that demand is likely to reduce when mills begin their maintenance work in December.
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