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Our Advance/Decliner Index declined for the fourth consecutive week to an eight-week low after surpassing the critical 50% level just four weeks ago. Our Ex-China Index …more
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Baosteel announced unchanged sheet prices for October shipments overnight, which is a real plus for the global steel industry for the following reasons….more
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Final August Chinese steel production came out overnight at 1.89 million tonnes per day (mtpd), down a whopping 5% from July’s 1.99 mtpd, down some 6% from… more
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Steel Market Production Cuts – An Italian Court reportedly ordered the stoppage of raw materials being shipped to Ilva’s the 11 million tpy capacity steel plant in Taranto, Italy – the company reportedly has enough raw materials on hand to run for 15-20 days.
Steel Market Production Increases – Chinese steelmaker Angang will be commissioning a new 1.6 million tpy special steel mill in November of this year.
Steel Market Production Cuts – Chinese steelmaker Jiyuan has been ordered byChina’s Ministry of Industry & Information Technology (MIIT) to eliminate 800,000 tpy of steelmaking capacity through the shutdown of two converters.
Steel Market Production Cuts – Chinese steelmaker Tianli has been ordered by China’s MIIT to permanently shutter its 300,000 tpy blast furnace.
Steel Market Production Cuts – Chinese steelmaker Fulong has been ordered by China’s MIIT to eliminate 300,000 tpy of steelmaking capacity through the shutdown of two EAFs by December of this year.
Steel Market Production Increases – Ukrainian steelmaker Alchevsk plans to increase its output of crude steel in September by 10% compared to August to around 321,000 tonnes.
Sources: Steel Business Briefing, SteelOrbis
Weekly domestic raw steel production for the week ending September 8, 2012 fell 2.8% to 1.811 million tons (mt) from 1.864 mt last week and was down 3.1% year-on-year.
We would caution readers that only half of the AISI reporting companies release their weekly production in “real time” so the other half of this data is estimated – using prior months’ reported production & operating rate. What this means is that when production is changing, the weekly data is actually understating the change.
Capacity utilization fell to 73.3% this week, below the year-ago level of 76.4% and the lowest since last November.
The lowest production level since the recession began was 800,000 tons for the week of December 27, 2008, while the highest level was 2.005 mt for the week of May 12, 2012. The lowest capacity utilization rate since the recession began was 33.5% for the week of December 27, 2008; the highest was 81.1% on May 12, 2012.
Source: AISI and Steel Market Intelligence
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The August ISM Steel Survey reflects more of the bi-polar recovery we had been seeing the past few years, with both a bit more optimism and a bit more pessimism as …more
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August net Chinese steel exports dropped 3.8% to 3.01 million tonnes (mt) from 3.13 mt in July, as the combination of government-guided production cuts… more
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The spot reference price for 62% Fe iron ore cfr North China fell 0.4% to $89.00 for the week ending September 7, 2012, the lowest level since the week ending October 30, 2009. Iron ore prices have now fallen for five straight weeks for a total decline of 23.7% over that time period.
For the first quarter of 2012, the iron ore price averaged $141.84, and for 2Q, $139.35; this compares to an average of $176.90 for 1H 2011 and $167.59 for full-year 2011. The post-recession low was $59.10 on March 27, 2009, while the high was $190.19 on February 17, 2011.
Source: The Steel Index
ArcelorMittal just announced a tentative agreement with the USW. No details are available, and we expect to see few in the coming weeks, as the ratification process is typically sensitive and typically companies – both USS and Mittal in this case – have very little to say until the contract is voted on.
We believe this development is a healthy one for the industry, as the high profile of the tenor of negotiations most probably was unnerving some buyers – unnerved buyers double order, build inventories and seek out imports.
So this is good news for all.
Update from Pittsburgh: September 8, 2012 – 1 p.m. EDT
The following statement is from ArcelorMittal USA and includes a quote from Michael Rippey, President & CEO, ArcelorMittal USA:
ArcelorMittal has reached a tentative agreement with the United Steelworkers (USW) on a new, three-year labor contract covering nearly 14,000 USW-represented employees at 15 of ArcelorMittal USA’s flat carbon, long carbon and iron ore mining locations. The tentative agreement will replace the existing contract that was originally set to expire on September 1, 2012 and remains subject to ratification by the USW membership.
“We are pleased to have a new, tentative agreement with the USW and to have reached a fair and equitable outcome without disruption to our business operations,” said Michael Rippey, president and CEO of ArcelorMittal USA. “We extend our appreciation to our employees, customers and the community for their patience and support during the negotiation process.”
