Category: Latest Updates

Steel industry changes based on regional market developments such as carbon emissions market regulations and import safeguards may increasingly complicate pricing of coking coal and steel raw materials under global benchmarks and premiums.

Steel industry market participants are closely viewing the EU’s Carbon Border Adjustment Mechanism announced on July 14. Turkey has announced a formal green plan as a roadmap to cut emissions, which could help its industries limit the burden of competing with EU industry sectors under the CBAM. Commonwealth of Independent States producers — many which have mines and are vertically integrated – are mulling over how CBAM may impact strategic operations, investments and sales structure.

The effect of carbon prices on existing steel business models may see various implications in acceptable pricing mechanisms for coking coal, said the CEO of trader Xcoal Energy & Resources at the Platts Singapore Coking Coal Conference on July 15.

“How will we price coal, when there’s going to be a mix of sales revenues for our customers subject to CBAM,” Xcoal CEO Ernie Thrasher said in a keynote at the webcast conference. “The result of that may be that a ‘one size fits all’ pricing mechanism needs to evolve into almost custom orientated negotiations, discussions with customers.”

New pricing agreements may adapt pricing terms to allow the customer to make a profit, but also for mining companies to recover sufficient capital to have sustaining capex to provide returns to their investors and shareholders, Thrasher said.

Xcoal supply coals globally, and has customers in the EU, as well as steel exporting countries outside the region, and is a major US coking coal exporter to Asia.

The EU is planning to introduce the CBAM in 2023 and for the mechanism to be fully in place in 2026. The system will be based on trading in certificates, using emissions data.

Steel and aluminum will be included in CBAM, affecting steel from countries such as the UK, Ukraine, Russia, Turkey, Egypt, India and China.

While coking coal, iron ore and metallics will not be included in CBAM, the effect of benchmarking emissions could lead to impact on trade flow and pricing for steel.

Already, iron ore contract pellet premiums negotiations have seen more protracted quarterly pricing negotiations, with blast furnace pellet settlements reported by miner Vale said to no longer act as a global reference.

Europe’s large pellet market largely negotiates based on different terms to the rest of the world, and takes into account steel and freight market conditions, and substitution available in sinter and lump.

A buyer said July 19 Q3 pellet settlements in Europe have largely yet to conclude, with offers unlikely achievable, after Vale reported global settlements for Q3 blast furnace and DR-grade pellets in early June at higher levels from Q2.

Vale has limited BF pellet availability for Q3, with some buyers unable to secure tons, according to market source.

With Europe’s steel industry preparing for CBAM costs and unable to fully realize production volumes to capture high spot prices after the COVID-19 pandemic, regional factors may limit a quick take up of higher pellet premiums. With necessary investments to lower emissions, European demand for DR-grade pellet may grow by 2025, complicating long-term planning.

— Hector Forster

Disruption of steel shipments due to the intense flooding in Germany’s Rhine-Ruhr region has further intensified logistics issues for that country’s steel businesses, with Thyssenkrupp the latest declaring force majeure and market sources July 19 citing transport disruptions.

“There are problems everywhere,” said a mill source. “The DB Cargo main railhead is in Hagen. Barges can’t go [on the Meuse River] because of the high water. Parts of the railway are missing. Trucks were difficult to get; now it’s even worse.”

In comments to S&P Global Platts, a Thyssenkrupp spokesman said July 19: “We have to wait to see how the situation develops on the logistics side.”

The steelmaker declared force majeure on July 16, according to a letter to customers, saying it was unable to deliver pre-material between the company’s sites. Steel deliveries to customers are also disrupted, it said.

“Length and scale of the disruption and the effects are not known at this point,” the company said in the letter.

Thyssenkrupp is the biggest steelmaker in Germany, shipping 2.7 million mt of hot- and cold-rolled material between January-March of this year. The company’s biggest site is in Duisburg, at the junction of the Rhine and Ruhr, with several processing sites in the area. Barge shipments of raw materials on the Rhine are not affected by the floods, the spokesman said.

An ArcelorMittal spokesman, meanwhile, told Platts July 19 that logistics are hampered at several locations but that production would be running “near normal.”

One of ArcelorMittal Germany’s main sites is also in Duisburg.

Germany’s biggest stockholder, Kloeckner, has previously said it has not been affected by the floods and delivery delays, and that subsidiary Becker Stahl did not have any “noteworthy” problems.

Cold-roller Bilstein, based in Hagen, declared force majeure July 14 following the flooding of its production facilities as well as closed railway lines used to receive material to process.

Although market participants said the current backlog in order books at mills and the ongoing shipment delays since last year are expected to intensify material tightness, spot prices have not been affected.

The daily Platts assessment for HRC stood at Eur1,170/mt EXW Ruhr July 19, slightly up by Eur4/mt on-day but plateauing overall for some weeks following rapid price rises on material tightness earlier in the year to all-time highs at Eur1,190/mt EXW Ruhr recorded in June. Prices were at its lowest ever recorded in June last year at Eur396.50/mt EXW Ruhr after demand collapsed during the first wave of the pandemic.

The floods came at a time when the market started to quieten down for the summer with little spot buying activity. Some sources believe the intensified delays in shipments could bring some upward pressure to prices once the market will be back from the summer holiday in early September.

— Laura Varriale

The US Court of Appeals for the Federal Circuit (CAFC) has upheld the authority of the president to raise Section 232 tariffs on Turkish steel imports from 25% to 50% as enacted during the term of President Donald Trump in 2018, Kallanish reports.

According to a opinion filed this week, the CAFC has voted in a 2-1 decision to reverse two prior Court of International Trade (CIT) findings that former President Trump did not have authority to raise Section 232 tariffs on Turkish steel imports from 25% to 50% in August 2018.

“We conclude that the president does have such authority in the circumstances presented here…the authority of the president includes authority to adopt and carry out a plan of action that allows adjustments of specific measures, including by increasing import restrictions, in carrying out the plan over time,” the court explains.

Previously, the CIT determined that the president’s decision to double Turkish duties on steel violated Section 232 timing provisions, as well as violated equal-protection rights guaranteed to Turkish importers.

Zach Johnson USA

Die BDSV – Bundesvereinigung Deutscher Stahlrecycling- und Entsorgungsunternehmen e. V. kritisiert die innerhalb des „Fit for 55“-Klimapakets der EU-Kommission vorgesehene Verlängerung der kostenlosen CO2-Rechte für die Stahlindustrie um weitere 10 Jahre bis 2035 scharf. BDSV-Hauptgeschäftsführer Thomas Junker: „Der Erhalt der Wettbewerbsfähigkeit von Schlüsselindustrien ist ein Totschlagargument: Unsere Branche bietet bereits seit Langem – mit hochwertigem recycelten Stahlschrott als Rohstoff – eine reale ressourcen- und klimaschonende Alternative für die Stahlindustrie. Wenn wir bis 2050 in Deutschland und der EU wirklich klimaneutral wirtschaften wollen, brauchen wir keine weiteren CO2-Freifahrtscheine für die Stahlindustrie, sondern Anreize für Unternehmen, verstärkt Sekundärrohstoffe einzusetzen und Investitionen in Zukunftstechnologien der Kreislaufwirtschaft zu tätigen. Denn grüner Stahl wird aus Schrott gemacht.“

Der Name „Fit for 55“ bezieht sich auf die geplante Einsparung von mindestens 55 Prozent des CO2-Ausstoßes im Vergleich zu 1990 in der EU bis 2030 (bislang sind Einsparungen von 40 Prozent bis 2030 vorgesehen). Das umfassende Klimapaket, das aus 12 Einzelgesetzen besteht, soll heute von EU-Vizekommissionspräsident Frans Timmermans vorgestellt wer-den. Allerdings bleibt der mögliche Beitrag der Kreislaufwirtschaft zum Erreichen der Klimaziele aus Sicht der BDSV weiterhin deutlich hinter den vorhandenen Potenzialen zurück.

Neben den kostenintensiven Technologiesprüngen der Stahlbranche zur Dekarbonisierung kann vor allem der verstärkte Einsatz des zum Sekundärrohstoff aufbereiteten Stahlschrotts eine technisch ausgereifte und mit vergleichsweise geringen Investitionen umsetzbare Maßnahme für den Kilmaschutz darstellen. Wie hoch der Anteil von recyceltem Stahlschrott in der heutigen Stahlfertigung ist, hängt maßgeblich vom Produktionserfahrung ab. Während in der Oxygenstahlroute, die durch den Weg vom Eisenerz zum Stahl gekennzeichnet ist, nur wenig Stahlschrott eingesetzt wird, ist im Elektrostahlverfahren der ausschließliche Einsatz von Stahlschrott zur Herstellung neuen Stahls möglich. Folglich wäre mit dem zuletzt genannten Verfahren ein nahezu vollständig geschlossener Rohstoffkreislauf erreichbar, welcher auch positive Effekte auf die Klimabilanz Deutschlands und Europas hätte. Aber auch bei der Oxygenstahlroute sind noch deutliche Steigerung des Schrotteinsatzes möglich, zumal Europa Netto-Stahlschrott-Exporteur ist und das weltweite Stahlschrottaufkommen bis 2050 noch um 70 % zunehmen wird. Die Erhöhung des Stahlschrotteinsatzes ist also durchaus möglich und klimaschutzpolitisch geboten.

Wussten Sie, dass der Einsatz von 100 Tonnen Stahlschrott 167 Tonnen CO2 sowie Klima- und Umweltkosten in Höhe von 35.571 Euro einspart? Mehr dazu finden Sie auf unserem CO2-Rechner auf www.bdsv.org und in unserer Studie Schrottbonus. Die Stahlrecyclingbranche in Deutschland beliefert Stahlwerke und Gießereien jedes Jahr mit mehr als 20 Mio. t recyceltem Stahlschrott und ist damit ein Schwergewicht der Kreislaufwirtschaft.

Über die BDSV e.V.

Die BDSV – Bundesvereinigung Deutscher Stahlrecycling- und Entsorgungsunternehmen e.V. ist der größte Stahlrecyclingverband Europas. Die BDSV vertritt die Interessen von mehr als 700 Mitgliedsunternehmen der Branche. Zur Hauptaufgabe der Stahlrecyclingunternehmen gehört die Produktion qualitätsgesicherter Recyclingrohstoffe für die verarbeitende Stahlindustrie in Deutschland und weltweit.

Quelle: BDSV e.V. 

15.07.2021 von Hubert Hunscheidt

Vanilla Steel, eine in Berlin ansässige Handelsplattform für industrielle Materialien, hat eine Seed-Finanzierung in Höhe von 4 Millionen US-Dollar abgeschlossen. Angeführt wurde die Runde von June Fund, ebenso beteiligt waren bereits bestehende Investoren wie Seedcamp und Mustard Seed Maze.

Der Stahlsektor ist ein 330 Mrd. US-Dollar Markt (in EMEA), der ein großes Potenzial für digitale Transformation hat. Die COVID-Krise hat den Bedarf an digitalen Tools in dieser traditionellen Branche noch weiter beschleunigt.

Vanilla Steel, das 2020 gegründet wurde, baut einen Sekundärmarkt für überschüssigen Stahl auf, also für Material, das sich im Überbestand befindet und mit keiner Kundenbestellung verknüpft ist. Vanilla Steel erleichtert dabei Transaktionen, ermöglicht intelligentes Matchmaking, beseitigt manuelle und langwierige Prozesse durch Automatisierung und spart Zeit durch die Verkürzung des Verhandlungszeitraumes. Durch wöchentliche Online-Auktionen können Stahllieferanten in einem kompetitiven Bieterverfahren die richtigen Käufer finden. Vanilla Steel ist bereits in 50 Ländern mit mehr als 100 Stahllieferanten vertreten, die bisher mehr als 90.000 Tonnen Stahl auf der Plattform gelistet haben.

Mit der neuen Finanzierung wird Vanilla Steel das bestehende Team ausbauen, um in weitere Regionen zu expandieren und neue Produktentwicklungen schneller umsetzen zu können. “Vanilla Steel steht erst am Anfang seiner Reise. Die Stahlindustrie steht vor Herausforderungen, die durch eine unabhängige digitale Plattform effizient gelöst werden können. Unser Ziel ist es, Prozesse zu vereinfachen und mehr Daten in die Stahlindustrie zu bringen”, sagt Mitgründer Alexis Ducros.

“Wir denken ständig über netzwerkgetriebenen technologischen Wandel in großen Märkten nach und haben viel Erfahrung mit Investitionen in diesem Bereich. Vanilla Steel ist außerordentlich gut positioniert, um die Informationsflüsse im internationalen Stahlhandel zu digitalisieren und der Branche zu helfen, einen neuen Standard zu erreichen. Ich bin mehr als begeistert, das Team bei der Verwirklichung dieser Vision zu unterstützen”, sagt David Rosskamp, Gründer und geschäftsführender Gesellschafter von June Fund.

Über Vanilla Steel

Vanilla Steel ist ein unabhängiger Marktplatz für industrielle Werkstoffe. Das Unternehmen hat seinen Hauptsitz in Berlin und wird von den 4 Mitgründern Matthias Affeldt, Alexis Ducros, Clifford Ondara & Simon Zühlke geleitet, die zusammen 50 Jahre digitale Erfahrung mitbringen.

Quelle und Vorschaubild: Vanilla Steel GmbH

16.07.2021 von Angelika Albrecht

Asian stainless cold-rolled coil prices rose in the week to July 16, in line with strong raw material prices and a spike seen in the Chinese domestic market due to production reduction expectations.

S&P Global Platts assessed 304 grade 2 mm 2B stainless CRC at $2,950/mt CFR East and Southeast Asian ports on July 16, up $90/mt on the week.

Nickel prices continued to strengthen, and the official nickel cash price on the London Metal Exchange settled at $18,695/mt on July 15, up $515/mt week on week.

Spot market prices in China increased strongly during the week amid a bullish sentiment due to the Chinese government’s widening efforts to cut steel output across the country, and lower output due to power restrictions in southern China.

It was expected that the spot market could rise further in the near term, given the tightening supply and healthy demand, said a domestic trader. Spot market prices in southern China’s Guangdong province increased as much as Yuan 1,800/mt ($278/mt) week on week.

Exporters were suspending offers due to the sharp increase in the domestic market. Market participants were awaiting new offers from major mills in the July 18 week, and it’s likely to see offers exceeding 3,000/mt FOB level, said another China-based trader.

Meanwhile, a major Taiwanese mill had sold out its allocation for August shipment at $2,900/mt CFR, said a regional trader. Its prices could be higher if it was still offering, in light of the stronger raw material prices and the bullish Chinese domestic market. Demand is still good due to the tight supply, and Taiwanese mills’ new offers in the next round could rise above the $3,000/mt CFR level, he said.

The most actively-traded August stainless steel contract on the Shanghai Futures Exchange was at Yuan 18,740/mt on July 16, up Yuan 1,380/mt, or 7.9%, on the week. The contract had risen by a total of Yuan 2,410/mt in the recent two weeks.

— Analyst Yuelin Dai

Scrap futures contracts on the London Metal Exchange saw sharp losses over the week to July 15, as the near-term portion of the curve shifted to strong backwardation.

S&P Global Platts assessed the July scrap contract down $8/mt on the week to $505.50/mt on July 15, while August dropped $25.50/mt to $498/mt, September contract fell $26/mt to $493/mt, and October decreased $12.50/mt to $496/mt.

In line with softening physical scrap prices during the week, the forward curve for July to August contracts shifted to a strong backwardation, suggesting that futures traders expect near-term weakness in the physical market. The September to October portion of the forward curve shifted to a soft contango structure, suggesting futures traders’ expectations of physical prices to strengthen at the start of the fourth quarter.

Spot prices for physical imports of premium heavy melting scrap 1/2 (80:20) dropped $11/mt on the week to $484/mt CFR Turkey on July 15, as several deals were heard at lower levels in the market.

Market activity was slow July 15 due to a Turkish national holiday, and is expected to remain slow over July 19-23, for the Islamic holiday of Eid al-Adha.

“I do not expect much activity over the holiday period, but the downside appears to be quite limited and I maintain the view that this will be a short and shallow correction,” one EU recycler said.

“It’s apparent that with the backdrop of Russian export duty, the European steel safeguard measures extension and the unrelenting elevated freight rates will collectively lend an upward bias to steel prices, It’s apparent and self-evident that scrap can’t remain decoupled from steel,” he added.

Weekly scrap futures trading volumes over the week to July 15 totaled 43,960 mt, up from 40,590 mt recorded last week. The levels were the highest recorded since the week ending May 27, when trading volumes totaled 52,080 mt.

In line with scrap, rebar futures for August to October contracts also dipped on the week, albeit maintaining elevated levels, but the July contract saw slight gains. The contango structure for the July to August contracts forward curve softened on the week, as the August-September forward curve turned flat. The backwardation structure for September-October contracts was almost firm, overall highlighting uncertainty in the near-term physical market.

Platts assessed the July contract up $2/mt on the week to $732.50/mt on July 15, with August down $10/mt to $739.50/mt, September dropping $4.50/mt to $739.50/mt, and October $5/mt lower at $734.50/mt.

Turkish physical rebar export prices dipped $2.50/mt on the week to $720/mt FOB July 15. Most mills softened offer levels during the week, amid a lack of activity on the export market. Market activity is expected to remain slow during the holidays.

The daily outright spread between Turkish export rebar and import scrap was assessed at $236/mt July 15, up $8.50/mt on the week.

Rebar futures weekly trading volumes this week on the London Metal Exchange totaled 2,920 mt, down from 11,980 mt last week.

— Rabia Arif, Viral Shah

Marcegaglia, a leading steel reroller, is producing and shipping its products normally following a fatal accident at its Ravenna, Italy, plant, company sources said late July 16.

Sources at the Italian company said the accident, which occurred July 15, had involved a worker from an external logistics company.

“The Ravenna plant is operational,” a source said.

Marcegaglia produces around 6.2 million mt steel annually, with Eur5.5 billion ($6.5 billion) annual turnover, at 28 plants worldwide. Ravenna is one of its principal plants, producing hot- and cold-rolled steel coil.

According to local press reports, the worker was hit by a steel coil within the Ravenna works.

Market sources told S&P Global Platts on July 16 that they believed the plant had been shut following the incident. Platts was unable to ascertain if the mill had suffered a temporary break in its activities immediately after the incident.

Platts assessed Northwest European hot-rolled coil stable July 16 at Eur1,166/mt ($1,376.7/mt) ex-works Ruhr.

— Diana Kinch and Amanda Flint

The European steel market is contending with cheaper flows of Indian hot-rolled coil, with the July-September quota balance of 169,717 mt now exhausted, and material once sitting at the port now allocated to buyers, data from the European Commission showed July 13.

Indian HRC imports were heard as low as Eur1000/mt CIF Italy Ports, according to one European mill source.

“Most European mills are fully booked, not so many deals outside of contracts,” the source said. “There is very little spot. Some are taking positions with Indian imports. Despite the duty price, prices are still good.”

After the news of the EC’s decision to extend the safeguards at the beginning of July, imports booked in April and May have now entered the marketplace, eliciting a temporary bearish effect on HRC Italy prices.

“The main place we are seeing softening of prices is Italy,” the mill source said. “Everyone is expecting a price softening in September. We are in a wait-and-see mode. Now more material is being taken from imports but it’s still not enough, not for all products.”

Since the start of June, Italian HRC prices have decreased Eur30/mt to Eur1100/mt ex-works Ruhr.

HRC Imports were also making their way into the EU from Russia, with Eur1100/mt heard into CIF Antwerp despite the 15% export duty applied to Russian exports.

“I am seeing more availability coming from imports, so I think we are in a negotiable situation with mills. When you have import offers its more hopeful, we have other options” the buyer said. “We are negotiating and using imports to get [domestic prices] cheaper. It will put pressure on prices in Europe.”

Russia’s quota allowance of 416,848 mt now stands at 354,284 mt, or 85% remaining, with 18,455,864 mt awaiting allocation at European ports. The quota balance for Turkey now stands at 26,1820 mt out of the 330,388 mt initial allowance, the data showed.

Although the market does expect some softening over the summer, sources were insistent prices would rebound when customers return from the summer holiday.

“When imports are custom cleared and [arrive] to customers, perhaps the pressure could go down slightly because there is a feeling of better availability, but we know in September we’ll see the same situation,” a German distributor said.

Despite the influx of cheaper imports, sources have said that a steep correction is unlikely given high US steel prices, the removal of the tax rebate on Chinese steel, as well as the chronic lack of availability in Europe.

“Higher sales are possible especially if you grant availability,” an Italy mill source said.

— Amanda Flint

The northwest European hot-rolled coil (HRC) market was digesting the impact of devastating flooding today, particularly in the Hagen region of western Germany.

Hagen, in North Rhine-Westphalia, was severely hit and is home to some of Germany’s largest automotive-linked cold-rollers, as well as other service centres. A state of emergency has been declared, after the river Volme rose 3-4m in the last few days, bursting its banks.

At least one cold-roller and several service centres in the city declared force majeure because of damage to sites and rail lines. Some could not access their plants to ascertain the extent of the damage, but expected to be off market for incoming and outgoing shipments for a few weeks at least. Pictures of one service centre showed over 1m of dirty oily water and debris infiltrating the works. Should site electronics be impacted, it could take several weeks to rectify, an industry source said.

Those affected were already trying to find surplus cut-to-length and processing capacity in Germany or the Netherlands to keep servicing customers during the downtime.

Service centres further south in Germany reportedly could not receive material by barge because of elevated water levels on the Rhine, and there was concern this could hit river transportation. Full reservoirs in Sauerland and Eifel are likely to be released into rivers, which could exacerbate the situation.

Traders have already started fielding calls from end-users with tonnes stranded at the sites. Sheet prices could be pushed up by the constraints, depending on the extent to which flooding has impacted end-users.

There was talk of hot-dip galvanised lines at one German mill being affected, although a spokesperson said this was not the case.

In Belgium, logistical problems were still impacting deliveries to service centres. One cold-rolled and hot-dip galvanised producer sent employees home yesterday and planned to reopen tomorrow. Another was experiencing difficulties as incoming feedstock transportation was disrupted.

Argus‘ daily northwest EU HRC index slipped by €4.50/t to €1,175/t ex-works, while the daily cold-rolled coil (CRC) assessment was static at €1,310/t.

In Italy, market participants were surprised by the brief closure of a major reroller after a fatality. The site will be closed until 18 July, after the accident yesterday morning.

One Italian mill was still offering September delivery this week, having cut sheet prices into Germany by around €30/t. Others were reportedly booked until October and beyond for certain grades. Headline offers were still around €1,120/t ex-works, although they were negotiable amid quiet demand. Argus‘ daily Italian HRC index was static today at €1,085/t. Given the disparity between Italian and northwest European levels, more tonnes are expected to be sold south to north — if possible, given the logistical difficulties.

Imports were still being quoted as much as €150/t below domestic prices, although some said this could change in light of growing talk of export restrictions in China. Market talk in China today suggested the country could implement export quotas, with a 20pc tariff for HRC shipments over the allowed level, although this was not yet official.

An Italian mill sold a small lot of hot-dip galvanised at €1,350/t delivered for November, although buyers were eyeing Asian material which was closer to €1,200/t base delivered. Asian CRC was offered into Italy and Antwerp at €1,120-1,150/t cfr, albeit for November-December delivery, at a steep discount to domestic quotations.