Izostal-Stalprofil consortium wins back-to-back Gaz-System pipe deals

A consortium of Izostal and its majority shareholder Stalprofil has won a PLN 115.35 million ($33.43m) contract to supply coated DN 1,000 pipe to Gaz-System, with deliveries scheduled from 1 June 2018-28 February 2019. This will be used by the Polish gas pipeline operator to build the 55km Tworog-Tworzen gas pipeline.

The same consortium also won a PLN 92.52m contract to supply DN 1,000 coated pipe for the construction of the 40km Strachocina-Pogorska Wola gas pipeline by Gaz-System. This section will be part of the 700km Hermanowice-Pogorska Wola pipeline. Deliveries are scheduled for 1 June-31 July 2018.

Polish gas pipeline investments finally accelerated in 2017 after previously stalling despite widely-touted large-scale investment plans by Gaz-System. Besides the pipeline operator, investments by Polish oil and gas company Polskie Gornictwo Naftowe i Gazownictwo (PGNiG) are expected to generate pipe demand in Poland.

Earlier this week PGNiG named Izostal as one of the preferred bidders in its open tender for newly-produced casing pipe and tubing, as well as accessories for boreholes (see Kallanish 4 January).

Barrett Steel improves performance in fiscal 2017

UK stockholder Barrett Steel produced an improved set of year-on-year results in its latest company report monitored by Kallanish. The country’s largest independent steel stockist’s performance continues to be a bellwether for the state of the distribution sector in the UK.

In his statement, chairman James Barrett gives an optimistic outlook on prices for the company’s fiscal year ending 30 September 2018. He says that the company expects steel prices to continue to rise due to increased import and conversion costs in the steel supply chain. The impact of the Brexit vote has not had a material impact on demand in its traditional market of construction although the situation “… remains uncertain,” Barrett adds.

The year ended 30 September 2017 saw a general continuation of the steel price increases seen in the previous financial year due to cost pressures in steel supply chains. These cost pressures have been caused by negative currency fluctuations and increasing raw materials prices.

Stocks at the year-end increased from £55.5 million ($75.3m) to £63.2m. The group continues to follow the strategy of managing risk by insuring the debtor ledger, it confirms. Barrett Steel also implemented capital investments worth £4.5m during the year. These included investments in new processing equipment, IT developments and transport fleet upgrade.

Group turnover for the year increased by 14% to £292.7m. Profit before tax improved from £4.3m to £5.9m same basis, but gross margin fell from 33% to 30% due to price competition in the market, Barrett Steel confirms.

Kallanish

October brought a boost to downstream sales: EUROMETAL

European steel service center continued to see sales accelerate in October with flat steel distributors increasing shipments by 8.9% year on year according to EUROMETAL, a distribution and trading association.

The strong performance helped year to date shipments outpace 2017, with sales in the first 10 months of 2017 up 0.9% on January-October 2016. Flat steel players continued to outperform the multi-product stockholding sector,where October shipments rose 5.5% on year, but shipments for the first ten months remained down 1.7% on 2016.

While stock levels have declined, the EU service center volume index closed at 111 in October, up on the 103 in October 2016 where 100 is equivalent to the average month in 2015. Much of this higher stock is as a result of the higher demand for galvanized flat steel.

Stock volumes of EU Multi-Product & Proximity Steel Stockholding Distribution noted in October 2017 at index of 101, up from 95 in October 2016.

Expressed in days of shipments, stocks of October 2017 levelled at 68 days, down from 71 days in October 2016.

Peter Brennan, PLATTS

ORYX Commodity News: Goose for Christmas and Fruit Punch in Summer

• Steep rises in nickel stopped for the moment. Stimulus of electro-mobility is still very much far in the future. Even China is putting on the brakes because of debt reduction and environmental issues.
• But the market prognosis for 2018 still looking positive. World trade is growing again. Final demand for stainless steel is good. Deficits in supply are successively reducing LME stocks.
• China is investing more in electric arc furnaces. These are predestined to use scrap. Scrap is low in emissions and attractive. This is good for the environment and the economy.
• Glencore is forming a partnership with the teachers of Ontario which will focus on mining royalties. The teachers’ pension fund hopes for good returns. Glencore can build on its mining portfolio and profit from its marketing.

 oryx_commodity_news_08.12.2017

EU steel distributors’ sales grow again in October

Sales by multi-product steel distributors and flat service centres both grew in October compared with last year. Nevertheless, the aggregated number for 2017 continues to show different developments, Kallanish learns from the European steel distributors’ trade body, EUROMETAL.

Service centres’ sales increased by 8.9% year-on-year in October; and they recovered by 0.9% y-o-y. overall during the first ten months of the year

Meanwhile multi-products distributors saw sales rise by 5.5% y-o-y in October, but the aggregated figure for 2017 remained negative, at -1.7% y-o-y.

Both service centres and multi-products distributors registered higher stocks at the end of October. The index for service centres rose to 111 at the end of October, compared with 103 a year earlier (2015 = 100). This has followed a substantial rise in stock volumes of galvanized flat products, EUROMETAL says.

The stock index for multi-products’ distributors also jumped 6 points to 101.