Stamping Out a Living

RECORD HIKE FOR US STEEL PRICES

2008-05-07T18:46:00.001-04:00

MEPS
US transaction prices are going through the roof with gains over the last four weeks as high as $US145 per tonne for some products and more substantial hikes planned by the mills for June deliveries. Domestic values have now caught up with average world prices. Although real demand is no more than satisfactory as the economy weakens, supply is being allocated by the local mills. The availability of imports is virtually nil, due to the weak US dollar, high ocean freight rates and soaring prices in other regions. OEM's complain that expected delivery times are not being met. Inventories at the service centres are described as 'low to medium'. They are unlikely to be rebuilt in the short term as buyers are unwilling to speculate when steel is so expensive.
In Canada, domestic order intake is strong. Producers need to offset the large increases in raw materials, such as iron ore and scrap. Consequently transaction values continue to advance, despite alarm amongst customers. Current imports and permits for the future remain low.

ASIAN AVERAGE CARBON STEEL PRICES - LATEST FORECASTS FROM MEPS

2008-05-07T18:44:00.001-04:00

MEPS
All MEPS flat products forecasts have been revised upwards as a result of the staggering 200 percent price rise in coking coal contracts. Scrap figures also rocketed during April. Growing imports for most products will not be sufficient to relieve the tight supply situation in the market in the short term. Consequently, transaction values are expected to climb until the middle of the year.

Chinese steel an issue in Pennsylvania primary

2008-04-20T09:40:00.001-04:00

Steel is becoming an issue in the US presidential race.

STLtoday

In the hollowed-out towns where steel plants once thrived, business and labor are uniting to demand that presidential contenders stand up to a growing threat to American steel — China.

Explosive growth in Chinese steel imports fueled by China's subsidies and questionable trade practices are triggering anti-China sentiments and fears for the future in American communities sustained for decades by the manufacture of steel.

Now, China's threat to American steel towns from Pittsburgh to Granite City is center stage in the debate over trade and globalization.

Chile copper strike keeps two Codelco divisions shut - Yahoo! Malaysia News

2008-04-20T09:37:00.001-04:00

This can't be good for copper prices.

from Yahoo Malaysia
A strike by Chilean mining subcontractors in its fourth day and denting output will keep state-run copper powerhouse Codelco's Andina and Salvador divisions closed through the weekend, the firm said on Saturday.

Volatile times ahead for copper pricing

2008-04-03T19:34:00.001-04:00

Last week, Bloomberg.com reported:

Mexico's copper output plunged 49 percent in January from a year earlier because of a strike at Grupo Mexico SAB's Cananea mine, the nation's largest producer.

This past Monday, they reported
Striking miners and other workers scuffled with rocks and sticks at Mexico's largest copper mine, injuring nearly two dozen people, the mine's owners and local media said Sunday.
Grupo Mexico SAB issued a statement urging government authorities to intervene after Saturday's scuffle at the Cananea mine in the northwestern state of Sonora, where strikers tried to block other workers from entering the facility.

Copper is now at $3.90+ and still seems to be headed upwards.

STEEL PRICES DRIVEN UP BY RISING INPUT COSTS AND LIMITED SUPPLY

2008-03-27T21:08:00.001-04:00

MEPS INTERNATIONAL

Since it was announced that iron ore prices would rise by 65 percent, Chinese mills have sought to lift steel values quite substantially. Japanese producers have tabled advances of ¥20,000 per tonne for April deliveries and may even adjust prices further in the third trimester. Market values have already strengthened considerably in the wake of the announcements, amidst tight supply caused in part by buoyant demand from the auto makers.

Italians seize 30 tons of radioactive steel

2008-03-04T20:12:00.001-05:00

This usage of the word "accident" raises more questions than it answers. How do you accidentally mix steel with cobalt-60?

USATODAY.com
Italian police said Monday they have seized 30 tons of Chinese-made steel that had been contaminated by a radioactive substance.
[...]
The steel had been accidentally mixed during production with cobalt-60

Ship built with WTC steel christened

2008-03-02T19:49:00.002-05:00

I've talked about this story before (click the WTC link below), but now it's been properly christened and launched.

Yahoo! News

The USS New York, an amphibious assault ship built with scrap steel from the ruins of the World Trade Center, was christened Saturday as a source of strength and inspiration for the nation.

Steel pipe factory breaks ground

2008-03-01T10:48:00.001-05:00

ContraCostaTimes.com
PITTSBURG -- Business executives and city leaders officially launched a new steel pipe factory Friday that is being designed to tap into the fast-rising demand for energy in the United States.
The $137 million United Spiral Pipe plant in Pittsburg will produce big steel pipes that are ideally suited for transporting oil and natural gas. The project is a joint venture of U.S. Steel Corp. and two South Korean companies, POSCO and SeAH Steel Corp.

Steel Prices May Rise Despite Declining Demand

2008-03-01T10:46:00.001-05:00

Tampa Bay Online (tbo.com)
Businesses that use steel for construction and other projects will continue to face high prices during the first half of 2008, despite a continued decline in housing and automobile demand that theoretically should begin to bring prices down.
That was the general consensus among steel industry and government trade officials who spoke Friday at the 19th annual Tampa Steel Conference, which drew more than 400 participants to the Tampa Marriott Waterside.
The price for a ton of cold-rolled steel coil, which now is about $752 in North America, could rise to $900 by April or May, said Tom Stundza, executive editor of the trade journal Purchasing Magazine. However, conference participants expected the high prices would begin to abate by midsummer or soon thereafter.

Codelco Copper Output Falls for Third Year

2008-03-01T10:41:00.001-05:00

This would go some distance towards explaining why copper inventories are so tight and prices so high. Hopefully the new mine in 2008 will bring some stability to the copper market.

Bloomberg.com
Chile's state-owned Codelco, the world's largest copper producer, said output fell 6.6 percent last year, the third straight annual drop, because of aging mines and labor protests.
Production dropped to 1.67 million metric tons from 1.78 million tons in 2006, Santiago-based Codelco said in a statement. A strike in June and July curbed output, and the amount of copper in the rock at mines declined.
Global stockpiles of the metal have tumbled this year, and copper prices have climbed 27 percent. Production will rise in 2008 with the opening of a new mine, Codelco Executive President Jose Pablo Arellano said at a news conference.

World Trade Center steel lives on in naval warship

2008-02-29T06:06:00.003-05:00

It's nice to see at least part of the scrap steel being used for something appropriate. It seemed odd somehow that the scrap was mostly taken away to be reprocessed in Asia.

The Record (NorthJersey.com)

The brains behind the use of salvaged World Trade Center steel in a new Navy warship is a Rutherford volunteer firefighter excited about seeing his vision christened this weekend as the USS New York.

Her name is New York, but to Scott Koen, she is a phoenix.

The christening will take place Saturday at a Louisiana shipyard with a bottle of champagne smashed across her bow, which contains 24 tons of steel that once towered over Lower Manhattan.

Armed with air-defense missiles and two 30mm guns for close combat, the USS New York is designed for missions that include special operations against terrorists. It can carry a crew of 360 sailors and 700 combat-ready Marines who can reach shore by helicopter and assault craft.

Canada's Budget promises relief for manufacturing sector

2008-02-27T05:51:00.003-05:00

The news today in Canada is yesterday's budget, and the "headline" that there's a lot in there to help Canadian manufacturing, the "engine" of Ontario.

Well, is it true?

The federal government is providing $1 billion in tax relief for Canada's ailing manufacturing and processing sector by extending the accelerated capital cost allowance (CCA) for businesses.

Finance Minister Jim Flaherty said Tuesday that the government will allow businesses to use the accelerated CCA, on a declining basis, until the end of the 2012-13 fiscal year.

The CCA is a non-refundable tax deduction that reduces taxes owed by permitting the cost of business-related assets to be deducted from income over a prescribed number of years.

On occasion, a CCA rate is "accelerated" to increase the incentive for investing in an asset by permitting it to depreciate more quickly.

The accelerated CCA plan introduced in the 2007 Budget allowed manufacturing businesses to fully write off investments in machinery and equipment within two years.

This says that, if you have the money to invest in new machinery, you can pay it off sooner, that is, write it down sooner, lowering your tax bill. Hopefully, you'll take some of the tax refund and use it to actually pay it down faster at the bank, thereby also reducing borrowing costs, another expense.

But let's think about this a bit. Many Canadian manufacturers are already on the ropes, hanging on by their fingernails. Are investments in new machinery uppermost in their minds? Are new machines even in the picture? I don't think so. They're doing everything they can to keep from laying off more people, to hang on to loyal employees.

While I applaud government efforts to reward newer, higher-productivity machinery, that shouldn't be the whole picture. How about a reduction on Workers Comp premiums for companies with good safety records? How about cost sharing on CPP for a year or two? These are costs every manufacturer, even those on the ropes, has, and so every manufacturer will benefit from them.

So what do other people thing?

Manufacturers say budget comes up short Reuters Canada says:

Canada's budget offered some financial help for the country's struggling manufacturing sector on Tuesday, but industry groups said it would not be enough to offset the impact of a strong domestic currency, a slumping U.S. economy and low-cost global competition.

[...]

Industry groups, however, said the one-year extension of the 50 percent rate would not give capital-intensive industries the time and funds needed to plan and execute the big investments they need to compete internationally.

"It's really a grab bag of goodies, some loose pocket change being thrown to the manufacturers," Jayson Meyers, president of the Canadian Manufacturers and Exporters Association, told Reuters.

[...]

Jim Stanford, an economist at the Canadian Auto Workers union, said the auto fund would not help workers who are losing their jobs as the industry cuts back.

"We would have preferred to see Mr Flaherty take a billion dollars out of that whopping 2007 surplus and create a real auto investment fund to match Ontario's billion-dollar fund," Stanford said.

The Toronto Star called it a show about nothing

Iron ore price rise could force China steel rationalization

2008-02-27T05:36:00.001-05:00

China Daily

[...]higher costs might actually help rationalize the Chinese steel industry by pricing some smaller firms with obsolete technology out of business.

After Brazilian mining conglomerate Vale hammered out 2008 benchmark prices for iron ore fines with Japanese and Republic of Korea (ROK) steel makers last week, Baosteel Group, China's largest steel maker, agreed on the price for fiscal 2008, accepting the Brazilian miner's price hikes that ranged from 65 percent to 71 percent compared with 2007.

[...]

China's steel needs have soared, driven by rapid urbanization and many large infrastructure projects. China imports almost half of the world's seaborne iron ore, making it the largest iron ore consumer in the world.

Steel Futures begin trading on London Metal Exchange

2008-02-27T05:31:00.004-05:00

I am suspicious of stock market mechanisms being introduced further into steel making. I'm not convinced that shareholders, with their quarterly-profits mentality, mix well with an industry where investments are made for a decade or more. However, I'm also unconvinced by the steel industries response ... that consolidation is a better way forward.

International Herald Tribune

New steel futures contracts introduced Monday in London could fill an information gap for one of the world's largest industries and shed light on global economic health, a leading British fund manager said.

"You've got this area from iron ore to a whole range of steel products that aren't catered for on an exchange," Frances Hudson, global thematic strategist at Standard Life, said. "These are very cyclical markets, and any additional good-quality information we can get about overall economic health is welcome."

See also AFP via yahoo news

Portraits of past make up Bethlehem Steel keepsake

2008-02-24T17:29:00.001-05:00

It's good that people are preserving the history of the Bethlehem Steel plant

The Morning Call

Bethlehem Steel photographer Peter Treiber went searching for his old negatives in company files in 1999, and he discovered something unsettling.

They were gone.

''There's a lot of photos, but they're spread all over,'' he said. ''No one knows where they all are. I was kind of upset no one was really preserving the history of Bethlehem Steel.''

As a result, Treiber set out to create a record of the Steel in his own pictures, which culminated in the book, ''Inside Bethlehem Steel: The Final Quarter Century.''

Alabama House passes bill to regulate hauling of steel coils on trucks

2008-02-23T10:27:00.002-05:00

We've talked before (1, 2, 3, 4) about steel coils falling off trucks, and legislative attempts to reduce the frequency (training) and severity (speed limits in some areas) of these incidents.

NewsFlash - al.com

The Alabama House has passed a bill that increases penalties for truckers or trucking companies that do not properly tie down large steel coils.
The House voted 99-0 to pass the bill that would fine a trucking company up to $10,000 for not properly tying coils on the backs of trucks. Drivers could be fined up to $5,000. Those violating the law would also face up to one year in jail.

Steel prices squeezing industries

2008-02-23T10:16:00.004-05:00

Steel prices keep rising, tarifs on cheaper off-shore steel remain on, and yet the finished goods, made from cheaper off-shore steel, are shipped into North America untarifed. So how can metal stampers survive when they can't even buy the raw materials, in some cases, for what the customer is asking for as a price for finished product?

The Times of Northwest Indiana

U.S. mills have increased spot prices for hot rolled steel to above $700 a ton for March delivery, a hike of about $50 per ton from the previous period and almost $200 a ton higher than in August. Prices for tubular steel have jumped to as much as $200 per ton from $75 a ton for March delivery. Bar and plate prices have been a bit more restrained.

Nucor recently reduced its raw material surcharge for rebar, merchant bar and structural products by $10 per hundred weight, but increased its base price by the same amount,

Rather than to increase profit margins, steelmakers contend they are raising prices to recover climbing costs for iron ore, ferroalloys, coke, scrap, energy and shipping.

At the $700-plus-per-ton level, the price of hot rolled sheet is at its highest point to date, said Tom Stundza, author of the monthly Steel Flash Report.

Despite poor demand from the housing, automotive and appliances steel-consuming sectors, steel companies appear confident that price hikes will stick.

I especially like this line, near the bottom of the article:

In a recent speech on the North American steel industry, AIIS President David Phelps said given the consolidation of the domestic steel industry, it's likely producers will succeed in defending their profit margins while squeezing those of steel users. [emphasis mine]

Long journey of Freedom Tower steel

2008-02-23T10:10:00.003-05:00

Some behind-the-scenes information about rebuilding where the twin towers stood.

AP via Yahoo! News
The steel bound for the Freedom Tower at ground zero travels thousands of miles, from a plant in Luxembourg where columns are rolled through casting machines at temperatures approaching 2,340 degrees.

Scrap metal melted into liquid steel in an electric furnace is cast, heated, cooled and heated again at the ArcelorMittal steel mill in Differdange.

The steel makes its way to a plant in Virginia where the huge columns are cut to size. Eventually, it is shipped to New York City, where the columns are lifted by crane and painstakingly set on top of each other at ground zero.

The jumbo steel columns — foot by foot, ton by ton — are forming the skeleton of the 1,776-foot Freedom Tower, designed just after the 2001 attacks to replace the destroyed World Trade Center. Each column makes a 4,700-mile journey, taking weeks and sometimes months to arrive at ground zero.

Poole begins Senate filibuster over steel coil legislation

2008-02-10T08:57:00.000-05:00

This issue of steel coils rolling off flatbeds and damaging roads and potentially injuring people seems like a pretty straightforward "clear and present danger", yet legislators are still playing political football with it. He didn't widen the road last year, so I'm not going to increase fines this year. Sheesh! Sounds like public school, not a state legislature.

GadsdenTimes.com
Sen. Phil Poole, D-Tuscaloosa, started another filibuster last week over a bill sought by Gov. Bob Riley that would up penalties to truckers and companies that allow those gigantic rolls of steel to bounce off their trucks, damaging roads and endangering motorists.

[...]

Waggoner said it costs $200,000 to fix each hole in pavement when a steel coil rolls off a truck.

Bamboo, dubbed 'vegetal steel,' superb for building

2008-02-09T09:21:00.000-05:00

Ah, but can you stamp it?

Charleston Daily Mail
Forget steel and concrete. The building material of choice for the 21st century might just be bamboo.

This hollow-stemmed grass isn't just for flimsy tropical huts any more - it's getting outsized attention in the world of serious architecture. From Hawaii to Vietnam, it's used to build everything from luxury homes and holiday resorts to churches and bridges.

Boosters call it "vegetal steel," with clear environmental appeal. Lighter than steel but five times stronger than concrete, bamboo is native to every continent except Europe and Antarctica. And unlike slow-to-harvest timber, bamboo's woody stalks can shoot up several feet a day, absorbing four times as much world-warming carbon dioxide.

"The relationship to weight and resistance is the best in the world. Anything built with steel, I can do in bamboo faster and just as cheaply," said Colombian architect Simon Velez

China's Pain is Century Aluminum's Gain

2008-01-26T19:07:00.000-05:00

The main part of the article is about aluminum, how a major aluminum smelter in China had to shut down, and what that's going to do to the aluminum market.

But the larger issue, for most stampers, is in this section. Power problems and unreliability in China are going to increase

Arif said that while the outages at Chalco’s plants are only temporary, there will start to be more power issues in China going forward. China has been subsidizing power for its users so demand for power has grown unabated, Arif said. As the costs to produce power, whether coal or other fuel, has increased, the Chinese government has spoken about increasing the power costs for institutional consumers like aluminum consumers. “That’s why you’ll start seeing a lot more of these types of power issues develop,” he said.

Copper May Drop on Reduced Metals Use Because of U.S. Recession

2008-01-25T18:46:00.000-05:00

Copper may fall next week on speculation the U.S. economy is sliding into recession, reducing demand for the metal used in wires and pipes.
Maybe, but so far, it's still hanging out in the $3 neighbourhood, a far cry from $2.50 a year ago and $0.80 5 years ago.

Copper drops, but not as much as you might think (or wish for)

2008-01-17T20:40:00.000-05:00

For an amusing hour or so yesterday, Kitco, my favorite metals reporting web site, was claiming that Copper had dropped a dollar to $2 and change. It must have been a reporting glitch, because later the metal went back up to $3 and change. But for a few minutes there I was ready to break out the champagne.

But copper at $3 is a lot better than a year ago, when it was up to $4.

Likewise, zinc is still above "normal" levels, but has subsided recently to a buck (it had been $2 just over a year ago).

Nickel, having been close to $25 a year ago, is down around half that now. For a while, in late 2007, it was actually down under 12

German Steel Sector to Stagnate in 2008

2007-12-30T11:31:00.000-05:00

Deutsche Welle | 30.12.2007

After years of record growth, Germany's key steel sector is likely to face more uncertain times as the fall in the dollar and the global credit crunch raise business risks, the nation's steel industry association said.After years of record growth, Germany's key steel sector is likely to face more uncertain times as the fall in the dollar and the global credit crunch raise business risks, the nation's steel industry association said.

[he said] major export industries such as the automotive field and electrical engineering were likely to be hit by a weaker dollar with automakers also scaling back demand as a result of concerns about new CO2 emission rules.