Thu Jul 21, 2011
* Traders expect no big rise in iron ore prices before Sept
* Global iron ore indexes vary
* Iron ore swaps rise
SHANGHAI, July 21 (Reuters) - Spot iron ore prices steadied on Thursday, with strong construction steel production continuing to offset the seasonal lull in higher-end steel demand.
Global steel production in June rose 8 percent to 127.746 million tonnes from a year earlier, driven by China, which accounted for 47 percent of the total.
While the industry typically downs tools in the hot summer months, the planned construction of 10 million affordable houses in China this year is expected to keep run rates at close to record levels.
"Steel demand will pick up largely in September, which will see iron ore prices facing a solid rise relatively long-term from then," said an iron ore trader in Beijing.
However, tightened monetary policy and thin demand for flat steel products used in automobiles and manufacturing are likely to trim any gains in iron ore prices.
"Steel demand will not improve greatly before September, so I don't expect iron ore prices to see a big spike in July or August," said the trader.
Spot offers for iron ore were steady again, with Australian 62-grade Newman fines quoted at $179-$181 a tonne, including freight, and Indian 63.5/63 fines offered at $182-$184, according to Chinese consultancy Umetal.
October rebar contracts on the Shanghai Futures Exchange , the most active on the market, dipped 0.22 percent to 4,913 yuan ($761) per tonne on Thursday, still close to its highest in more than two months.
Trading sources said steel mills have begun resisting 63.5 percent Indian ores at $182 per tonne, including freight, with transactions sealed around 50 cents lower.
Fitch Ratings said last week that it expected slower growth in steel demand and production during the second half of 2011 as developing nations fight inflation and developed nations address fiscal instability.
Iron ore indexes, tracking spot deals in China and used by global miners as the basis for quarterly contract prices, were mixed again on Wednesday.
The Steel Index's 62-grade measure .IO62-CNI=SI edged up 20 cents to $174.60 a tonne while Metal Bulletin's similar benchmark .IO62-CNO=MB lost 54 cents to $173.28.
The Platts index IODBZ00-PLT remained unchanged at $176.5.
However, Singapore Exchange-cleared iron ore swap contracts <0#SGXIOS:> rebounded across the board. ($1 = 6.459 yuan)
Showing posts with label global steel production. Show all posts
Showing posts with label global steel production. Show all posts
Thursday, July 21, 2011
Sunday, February 13, 2011
Rio Tinto chief expects iron ore price to ease
Feb14, 2011 12:00AM, The Australian,
RIO Tinto, the world's second-biggest miner of iron ore, expects the price of the commodity to ease in two to five years as new supply comes to market.
Chief executive Tom Albanese said: "It's hard to find big new areas of supply globally, particularly in 2011.
"But in 2013, 2014 or 2015, you will see a lot of new iron ore coming into the market and it's probably going to put the market closer in balance than it is today."
Mr Albanese told ABC's Inside Business program that the iron ore markets, "when they come into equilibrium, will lead to some softness in those markets longer term.
"I think anyone that invests on the basis of today's prices is likely to be disappointed down the road.
"The question really will be: over the next five to 10 years will be, what will be the global steel demand and how will that translate to iron ore production? I think realistically we can expect a reversion from current levels."
Rio last week said its 2010 profit nearly tripled to a record $US14.3 billion ($14.25bn), largely due to record prices for iron ore and copper during booming demand from China.
Expanding its Pilbara iron ore operations in Western Australia by over 50 per cent over the next five years would be Rio's top growth priority, Mr Albanese said.
On copper, he said the longer prices remained high, the greater the supply response would be.
"I think we will see a continued period of strong copper pricing, largely because many of the large mines . . . are seeing declining grades (and) deepening pits, but you will see new mines . . . so we will see new copper supply coming in and that will begin balancing out with demand."
In regard to potash, Mr Albanese said he would rather look at small mergers and acquisitions opportunities to bolt on to the existing Rio businesses.
(sourced:Dow Jones Newswires)
RIO Tinto, the world's second-biggest miner of iron ore, expects the price of the commodity to ease in two to five years as new supply comes to market.
Chief executive Tom Albanese said: "It's hard to find big new areas of supply globally, particularly in 2011.
"But in 2013, 2014 or 2015, you will see a lot of new iron ore coming into the market and it's probably going to put the market closer in balance than it is today."
Mr Albanese told ABC's Inside Business program that the iron ore markets, "when they come into equilibrium, will lead to some softness in those markets longer term.
"I think anyone that invests on the basis of today's prices is likely to be disappointed down the road.
"The question really will be: over the next five to 10 years will be, what will be the global steel demand and how will that translate to iron ore production? I think realistically we can expect a reversion from current levels."
Rio last week said its 2010 profit nearly tripled to a record $US14.3 billion ($14.25bn), largely due to record prices for iron ore and copper during booming demand from China.
Expanding its Pilbara iron ore operations in Western Australia by over 50 per cent over the next five years would be Rio's top growth priority, Mr Albanese said.
On copper, he said the longer prices remained high, the greater the supply response would be.
"I think we will see a continued period of strong copper pricing, largely because many of the large mines . . . are seeing declining grades (and) deepening pits, but you will see new mines . . . so we will see new copper supply coming in and that will begin balancing out with demand."
In regard to potash, Mr Albanese said he would rather look at small mergers and acquisitions opportunities to bolt on to the existing Rio businesses.
(sourced:Dow Jones Newswires)
Wednesday, February 2, 2011
Global steel prices continue their upward surge
February 2, 2011
Transaction prices are moving relentlessly upwards worldwide as steelmakers address their escalating raw material costs.
The MEPS Global Composite Steel Price increased by 10.5 percent in January 2011, compared to December 2010.
In the US, the pace of flat product price increases is described as "fast and furious". The shortage of scrap and surging costs of other raw materials have pushed the mills into a frenzy of announcements regarding transaction numbers. As is usual, actual market prices are lagging behind the proposals. In the meantime, real demand is only just satisfactory.
Transaction values continue to head up in Canada at an alarming rate, with more increases to be applied through February and into March. Raw material costs are climbing rapidly and rising scrap prices are expected to generate further pressure. Steelmakers report that order books are strong as customers buy before transaction figures go higher and also to fulfil their needs to replenish and build inventories.
In China, steelmakers are facing sharply higher costs for iron ore and coking coal, which they must pass on to their clients, both at home and abroad. Purchasing by end-users has started to slow ahead of the upcoming Chinese New Year in early February. However, there is speculation that prices will continue to climb after the holidays, especially as many leading producers have elected to lift their official February ex-works figures.
Despite a slow recovery in consumption in many Japanese end-user sectors, market activity is improving. A very positive price revival is underway, as a result of an upsurge in steelmaking costs. In South Korea, demand from downstream industry remains lacklustre, making it quite difficult for the mills to implement increases. Posco is reluctant to try to cover rising raw material costs by means of domestic hikes in the first quarter.
Consumption in western Europe has changed very little during the last four weeks. Nevertheless, domestic producers are poised to lift second quarter offers because of raw material price developments and energy cost increases. Steel output has been curbed and restocking is expected to get underway shortly.
Source: MEPS
Saturday, January 22, 2011
Global steel output rises to record
Fri Jan 21, 2011 6:06pm GMT
* Asia drives steel production growth
* Western economies lag behind Asia
* China share of global production falls
By Silvia Antonioli
LONDON, Jan 21 (Reuters) - Global crude steel production touched a new record in 2010, driven by growth in emerging regions and improving manufacturing in the developed world, although the construction sector remained gloomy.
Global production rose 15 percent to 1.414 billion tonnes in 2010 from 1.327 billion in 2008 and 1.229 billion in 2008, according to data released by the World Steel Association on Friday.
"The production data is better than people could expect in the aftermath of the crisis in 2009," said Anthony de Carvalho, administrator on the steel committee at the Organisation for Economic Co-operation and Development(OECD).
"The economic stimulus programmes (undertaken by governments) indirectly helped the steel industry. But many countries are still below pre-recession levels."
Asia and other developing countries drove the growth and reached record production levels, while output in Western economies lagged behind 2008's levels as growth remained fragile and the construction sector was hit hard, analysts said.
Production in China, the world's largest steel producer, rose 9.3 percent to 626.7 million tonnes on the previous year, but its share of global production fell to 44.3 percent from 46.7 percent in 2009.
Analysts said China's growth was strong but hampered by electricity cuts in the last part of 2010, analysts said.
"China had problems trying to meet environmental requirements," said Peter Fish, managing director at MEPS, a steel information provider.
"But the Chinese could not grow 20 or 30 percent like some other countries, because in 2009, when everyone else took a dip, China didn't."
Chinese steel production is expected to grow but at a slower rate in 2011, closer to 5 percent versus 7-8 percent growth in India, Fisher forecast
As China's economy grows, the authorities are likely to turn to monetary policy to contain inflation, and this could affect steel demand, according to analysts.
"We do think that a tighter monetary policy in China will slow down steel consumption and this will start to kick in in the second half of 2011," said Chris Houden, analyst at CRU.
Japan, the world's second-largest steel producer, enjoyed 25.2 percent growth in 2010 to 109.6 million tonnes versus 2009. Its exports have got a boost from growth in neighbouring economies such as China and Korea, according to De Carvalho.
EU and U.S. steel production grew rapidly but from a lower base. Production in the European Union grew by 24.6 percent to 172.9 million tonnes and in the United States by 38.5 percent to 80.6 million.
These countries are still struggling with overcapacity, analysts said.
"(Capacity) utilization is picking up from low levels, but the question is: Will producers keep production low to get price increases?" said UBS analyst Andrew Snowdowne.
While steel production in emerging economies will continue to grow to record levels, it may take developed countries a few more years to go back to pre-crisis levels given the fragile state of their economies, analysts said.
(Reporting by Silvia Antonioli; editing by Jane Baird, reuters.com@reuters.net))
* Asia drives steel production growth
* Western economies lag behind Asia
* China share of global production falls
By Silvia Antonioli
LONDON, Jan 21 (Reuters) - Global crude steel production touched a new record in 2010, driven by growth in emerging regions and improving manufacturing in the developed world, although the construction sector remained gloomy.
Global production rose 15 percent to 1.414 billion tonnes in 2010 from 1.327 billion in 2008 and 1.229 billion in 2008, according to data released by the World Steel Association on Friday.
"The production data is better than people could expect in the aftermath of the crisis in 2009," said Anthony de Carvalho, administrator on the steel committee at the Organisation for Economic Co-operation and Development(OECD).
"The economic stimulus programmes (undertaken by governments) indirectly helped the steel industry. But many countries are still below pre-recession levels."
Asia and other developing countries drove the growth and reached record production levels, while output in Western economies lagged behind 2008's levels as growth remained fragile and the construction sector was hit hard, analysts said.
Production in China, the world's largest steel producer, rose 9.3 percent to 626.7 million tonnes on the previous year, but its share of global production fell to 44.3 percent from 46.7 percent in 2009.
Analysts said China's growth was strong but hampered by electricity cuts in the last part of 2010, analysts said.
"China had problems trying to meet environmental requirements," said Peter Fish, managing director at MEPS, a steel information provider.
"But the Chinese could not grow 20 or 30 percent like some other countries, because in 2009, when everyone else took a dip, China didn't."
Chinese steel production is expected to grow but at a slower rate in 2011, closer to 5 percent versus 7-8 percent growth in India, Fisher forecast
As China's economy grows, the authorities are likely to turn to monetary policy to contain inflation, and this could affect steel demand, according to analysts.
"We do think that a tighter monetary policy in China will slow down steel consumption and this will start to kick in in the second half of 2011," said Chris Houden, analyst at CRU.
Japan, the world's second-largest steel producer, enjoyed 25.2 percent growth in 2010 to 109.6 million tonnes versus 2009. Its exports have got a boost from growth in neighbouring economies such as China and Korea, according to De Carvalho.
EU and U.S. steel production grew rapidly but from a lower base. Production in the European Union grew by 24.6 percent to 172.9 million tonnes and in the United States by 38.5 percent to 80.6 million.
These countries are still struggling with overcapacity, analysts said.
"(Capacity) utilization is picking up from low levels, but the question is: Will producers keep production low to get price increases?" said UBS analyst Andrew Snowdowne.
While steel production in emerging economies will continue to grow to record levels, it may take developed countries a few more years to go back to pre-crisis levels given the fragile state of their economies, analysts said.
(Reporting by Silvia Antonioli; editing by Jane Baird, reuters.com@reuters.net))
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