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Issue 7-12 13 Feb 2018
Last week raw material prices gave a clear sign that the global market remains in good shape, as both iron ore in China and scrap in Turkey moved up.
Iron ore started the week at slightly above $75/t CFR Qingdao only to move up to over $76/t CFR Qingdao by Friday. Last year in February the market reached its annual peak at above $92/t CFR Qingdao, but the current recovery trend in the market is indicating that the sentiment remains strong and that higher prices could be achieved going toward the end of the month.
Meanwhile scrap prices in Turkey, as reported, lost some $30/t since their peak in early January. Last week for the first time since the correction started, the market recovered $5/t to $350/t CFR Turkey, according to Kallanish price series. The price of scrap remains over $60/t above the levels registered in early February last year and the end of the negative trend monitored last week could well indicate that the market is stabilising and possibly preparing a further slight hike.
Issue 6-18 06 Feb 2018
The iron ore price in China is continuing to remain firm, supporting prices globally despite the correction seen in scrap prices since mid-January.
Last week iron ore remained at around $72-73/tonne cfr Qingdao, before jumping back to above $75/t cfr at the beginning of the current week. The rebound gave a strong signal to global markets as most flat products’ indices recovered further last week.
Issue 5-18 30 Jan 2018
Last week the World Steel Association (worldsteel) released its figures for crude steel production in 2017. According to the association, global crude steel output was 1.691 billion tonnes from its 66 reporting countries in 2017, up 5.3% year-on-year. Crude steel production increased in all regions in 2017 except in the CIS, which has remained stable (subject to current estimates), worldsteel says.
China produced 831.7mt in 2017, an increase of 5.7% on 2016 and representing 49.2% of global output. Asian output was 1,162.5mt, up by 5.4% on-year. Crude steel production in Japan in 2017 fell by -0.1% on-year to 104.7mt whilst that of India was an estimated 101.4mt, up by 6.2% from that in 2016. South Korean production grew by 3.7% y-on-y during the year to 71.1mt.
In the EU28 total annual crude steel production grew by 34.1% y-on-y in 2017 to 168.7mt. Estimated output in Germany grew on-year by 3.5% to 46.3mt. Annual output in Italy increased y-o-y by 2.9% to 24.0mt. French crude steel output rose on-year in 2017 by 7.6% to 15.5mt. Spanish output increased by 6.2% y-o-y to 14.5mt.
US crude steel output was 81.6mt in 2017, an on-year increase of 4.0%, whilst Total North American production was 116.0mt, 4.8% higher than in 2016. In Brazil crude steel production was 34.4mt, up by 9.9% on that in 2016. In South America, total regional production was 43.7mt, up 8.7% y-o-y.
Issue 4-18 23 Jan 2018
Seaborne iron ore prices gained strongly on Friday on the back of a rebound in Chinese steel prices. This supported the sentiment of the global steel market last week, but meanwhile scrap prices in Turkey fell by $15/tonne bringing some uncertainty in the European and Middle Eastern markets. The rebound in iron ore was supported mainly by the beginning of restocking activity in China and took the level back above the $75/t cfr Qingdao. Looking ahead, the confidence in the market could continue and the restocking is expected to support iron ore prices in the $70s in the near term. There has been some speculation during the last few weeks that prices could slide as mill buying tops out. Friday’s recovery was a useful reminder however that a confident steel market in China still typically means strong iron ore prices.
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