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voda 19 juni 2018 15:19

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GMS Market Commentaryon shipbreaking in Week 24 - RESISTANCE ENDURES!

As the Holy month of Ramadan draws to a close with the week long Eid festivities across the Indian sub-continent and Turkey, activity and sales seemed to gain momentum this week – perhaps with the anticipation of firming levels in the near future. As such, following the sale of two FSUs last week, there was another VLCC sale to report this week, at increasingly bullish numbers.

Curiously, it seems to be certain Cash Buyers who are driving the current pricing trend, rather than local markets / fundamentals. Bangladesh and Pakistan have been expectedly quiet during Ramadan and Eid holidays whilst India has remained volatile and barely aggressive on the larger LDT units.

It will therefore be interesting to see if prices do rise up to match some of the speculative offerings on recent tonnage. The general consensus is that Pakistan may remain inert for some time, due to the import of a majority of the unsold Cash Buyer VLCC and large LDT (wet) tonnage, following their April reopening for tankers.

Bangladesh too has endured a frustrating period on the sidelines following a dramatic decline in prices by about USD 50/LDT several months ago, leaving them as the lowest placed of all sub-continent markets at that time. However, a recent uptick in both demand and levels has seen Chittagong Buyers making a comeback of late. Despite this, it does not seem that local levels are matching Cash Buyer asking prices just yet.

Source : GMS Market

voda 19 juni 2018 15:20

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Kroman Celik selects Danieli for wire rod mill modernization

In May 2018, Kroman Celik (Yucel Boru Group) selected Danieli for the modernization of its high-speed wire rod mill, supplied by the same in 2006. The upgrade project includes the addition of a TMB-Twin Module Block and a newly designed HSS High-Speed Shear before the sizing block. The new systems will guarantee a size tolerance of +/- 0.10 mm, and 60% out-of-roundness on 4.5 mm dia wirerod, for scratch-free and defect-free products from superb quality wirerod produced at 115 m/s.

By installing these technological packages, Kroman Celik will expand its wirerod range from current 5.5 - 20 to 4.5 - 26 mm dia., also widening steel grade production to premium grades.

This plant performs thermo-mechanical rolling (low temperature rolling down to 750 °C and normalizing rolling), featuring a single-pass family in the pre-finishing and upstream mill, increasing rolling mill availability by minimizing size changes downtime.

TMB allows the production of any size at any time. Characterized by the most compact design, the High-Speed Shear provides the best automatic in-line trimming, improving material yield.

It will be in operation by Summer 2019.

Furthermore, a 1400-t cutting force scrap shear and a baler will be installed, to produce bales weighing more than 1000 kg, with a size of 60x60 cm and a variable bale length up to 1 m.

Source : Strategic Research Institute

voda 19 juni 2018 15:21

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Trump Trade War - Steel imports into UK more than doubled – Report

Mirror UK reported that in another blow to our ailing sector, shipments from non-EU countries rose from an average 16,318 tonnes a month to 35,332 this year, according to figures from agency Eurostat Imports of specialist foreign steel to the UK more than doubled ahead of America imposing its punitive 25% tariffs, it has emerged. In another blow to our ailing sector, shipments from non-EU countries rose from an average 16,318 tonnes a month to 35,332 this year, according to figures from agency Eurostat.

It suggests exporters were targeting non-US markets while Donald Trump planned his levies. And non-EU imports to the UK now top levels at the height of the 2015 Chinese dumping crisis, which triggered huge job losses.

Shadow Steel Minister Gill Furniss accused the Government of “an abdication of their responsibility to industry” by being “so unprepared for what has been a year-long looming crisis”. She added that “It is our steelworkers who risk paying the price.”

Imports of rebar steel from Turkey alone leapt from an average 7,995 tonnes a month last year to 13,583 tonnes in the first four months of 2018. Rebar from the Ukraine trebled from 3,035 tonnes to 9,262 and the amount from Russia was up from 2,021 tonnes to 3,212.

Source : Mirror UK

voda 19 juni 2018 15:21

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Substandard structural steel imported in Fiji

Fiji Times reported that an eminent local civil engineer has raised his concern on the importation of substandard structural steel used for the construction of buildings in Fiji. Erasito Consultants Ltd director Terence Erasito raised the issue during the Construction Industry Council conference at the Warwick Fiji Resort this week saying this came to their attention after they sent pieces of structural steel utilised in recent local projects for testing overseas, which had proven to include components of scrap metal. He said the structural steel, which did not meet ductility requirements, were purchased locally.

Mr Erasito said that “We’ve had projects where the structural steel failed under normal working conditions. It was going to be either the design or material that contributed to the failure, but we are very precise in our work so we knew it had to be steel.”

He added that “We cut off sections of the steel and sent it to a laboratory in New Zealand for testing and the chemical composition on the certificate that came back stated that the composition was the make up of scrap metal.”

Mr Erasito said this issue was of grave concern as structural steel and the reinforcing bars that do not meet ductility requirements could be catastrophic during unforeseen events such as an earthquake.

He added that “For instance, under an earthquake, when a structural engineer designs a building, it is meant to sway so the steel has to be ductile which means in the code, It needs to be able to be bent seven or eight times without losing strength. The steel that is coming into Fiji is brittle, there’s too much carbon or the chemical components doesn’t meet the ductility requirements the steel needs to be.”

Source : Fiji Times

voda 19 juni 2018 15:23

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AISI update on Raw Steel Production in US in Week 24

In the week ending on June 16, 2018, domestic raw steel production was 1,740,000 net tons while the capability utilization rate was 74.2 percent. Production was 1,747,000 net tons in the week ending June 16, 2017 while the capability utilization then was 74.9 percent. The current week production represents a 0.4 percent decrease from the same period in the previous year. Production for the week ending June 16, 2018 is down 0.7 percent from the previous week ending June 9, 2018 when production was 1,753,000 net tons and the rate of capability utilization was 74.8 percent.

Adjusted year-to-date production through June 16, 2018 was 42,061,000 net tons, at a capability utilization rate of 75.4 percent. That is up 1.7 percent from the 41,344,000 net tons during the same period last year, when the capability utilization rate was 74.4 percent.

Broken down by districts, here's production for the week ending June 16, 2018 in thousands of net tons: North East: 217; Great Lakes: 630; Midwest: 172; Southern: 644 and Western: 77 for a total of 1740.

Source : Strategic Research Institute

voda 19 juni 2018 15:25

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HYBRIT’s World-first Pilot Plant Wins Energy Agency’s Backing

HYBRIT—SSAB, LKAB, and Vattenfall’s project for creating fossil-free steel has been granted SEK 528 million in financial backing by the Swedish Energy Agency. HYBRIT has the potential to reduce Sweden’s total carbon dioxide emissions by ten percent, and Finland’s emissions by seven percent. For Sweden’s part, the reduction has been described as crucial to the country’s efforts to meet the goals laid out in the Paris Agreement.

The Swedish Energy Agency today confirmed its decision to provide financial support for the HYBRIT project in connection with the construction of a pilot plant that is expected to be completed by 2020. The plant will perform tests that will allow fossil-free steel production to be scaled up. Expenditure for the pilot phase is expected to total SEK 1.4 billion, of which project owners SSAB, LKAB, and Vattenfall will provide 63 percent. The support from the Swedish Energy Agency covers 25 percent of the cost for the actual pilot plant, and higher percentages of the different scientific projects. The Swedish Energy Agency‘s total contribution amounts to about 37 percent of the total estimated costs..

Mr Mårten Görnerup CEO of HYBRIT said that “Trials at pilot-plant scale are necessary to verify our conclusions from the small-scale laboratory attempts in a larger scale that is more similar to the future industrial process. They provide the basis for a clearer understanding of what happens within an interconnected industrial system and how we can achieve an efficient production process. This is a critical step in order to ultimately reach our goal of fossil-free steel production and to reap all its environmental benefits. With that in mind, we’re very happy that the Swedish Energy Agency has chosen to continue to support us."

Remy Kolessar, Head of the Department for Research and Innovation at the Swedish Energy Agency said that “Our involvement with the HYBRIT initiative is helping drive the transition to both a fossil-free industry and a sustainable way of life. We’re also helping to promote the Swedish steel industry’s ability to compete in the long term as well as stepping up efforts to establish unique, green energy systems in Sweden"

The funding provided by the Agency covers two subprojects:

Project 1 (Preliminary studies on direct reduction based on hydrogen gas with a subsequent steel production process) concerns preliminary studies on the direct reduction of iron ore pellets using hydrogen gas and their subsequent melting in an electric arc furnace for the purpose of steel production. These studies aim to develop a technique in which pure hydrogen gas is used as the reducing agent in the production of sponge iron from iron ore pellets. This is both HYBRIT’s core concept and the phase that requires the most research and development.

Project 2 (Preliminary studies on fossil-free pellet heating) investigates the development of a fossil-free heating technique for the sintering of iron ore pellets. The studies’ dual aim is to reduce emissions from existing pellet plants and to design a new pelletizing process.

Two feasibility studies have been carried out since HYBRIT was launched in the spring of 2016. A research project was also started in 2017 using funds provided by the Swedish Energy Agency. This project comprises a large-scale collaboration between industry, academia, and research institutes aimed at identifying possible fossil-free options in the energy-mine-iron-steel value chain.

The Swedish Energy Agency has previously contributed SEK 60 million in support of HYBRIT’s preliminary studies and research projects, together with a further SEK 10 million, equal to half the cost for the planning and design of the pilot plant whose construction will begin in June 2018.

In 2024, HYBRIT will transition from the pilot phase to the demonstration phase (scheduled to run from 2025 to 2035), which will be equivalent to small industrial-scale production. The plan is to have established a fossil-free industrial steel production process by 2035.

Source : Strategic Research Institute

voda 19 juni 2018 15:29

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Indian steel production gathers steam –Care Rating

Care Rating said that “During 2017-18, output in India grew by 3.1% to 105 million tonnes and consumption increased by 7.9% to 90.7 million tonnes The demand for steel from user industries is likely to result in increase in production and is expected to keep the prices firm during 2018-19, while some moderation in steel prices may be seen during the monsoon months as infrastructure and construction activities slow down during these months. The prices had averaged 18%-21% higher during 2017-18.”

“India’s steel production grew by 3.1% on a YoY basis to 105 million tonnes during the financial year 2017-18 backed by 7.9% growth in consumption during the year. The increase in output however is slower compared to 11.9% YoY growth reported by the industry during 2016-17 when production stood at 101.8 million tonnes.

Consumption growth rate on the other hand accelerated to 7.9% during 2017-18 compared to 3.1% YoY rise registered by the industry during 2016-17.

Steel has its usage in different industries depending on its category. Steel products can be widely divided into two categories, long and flat products. There are various products manufactured within these two categories based on the needs of user industries. While long products are generally used for construction, mechanical engineering, energy and automotive, flat products are generally used for automotive, heavy machinery, pipes and tubes, construction, packaging and appliances.

In addition to these two broad categories, finished steel production also includes alloy steel. It refers to steel that contains one or more alloying elements like chromium, manganese, silicon, nickel, copper, aluminium. This also includes stainless steel. Alloy steel has certain properties that are not observed in normal carbon steel and alloy steel is used in automotive, railways, defence and engineering.

During 2016-17, the output of flat products grew by a healthy 20.9% to 49.3 million tonnes and long products increased by 5% to 44 million tonnes on a YoY basis. In the next year 2017-18, the output of long products rose by 2.3% to 45 million tonnes and that for flat products was up by 0.9% to 49.8 million tonnes.

The output of alloy steel on the other hand grew by a strong 20.7% to 10.2 million tonnes which led the rise in finished steel production during 2017-18. In the previous year, production of alloy steel had increased by 2.3% on a YoY basis to 8.5 million tonnes.

India’s steel production is expected to remain higher in the current financial year 2018-19 backed by growth in domestic demand from user industries during the year.

Construction & infrastructure sector is the largest consumer of steel in India, it accounted for a noteworthy share of 62% of the total finished steel consumed during 2015-16. This was followed by engineering & fabrication sector, which had a second largest share of 22.1% of the total finished steel consumed during the year. The automotive sector was the third largest consumer of steel with a share of 10.1%, other transport and packaging & others sector had a share of 2.9% each in total finished steel consumption.

This sector includes building of highways, bridges, airports, ports, water transportation, pre-fabricated buildings, power projects, real estate residential and industrial. A notable portion of the steel manufactured in India (both flat and long variety) finds its usage either directly or indirectly in the infrastructure sector. A noteworthy proportion of long product consumption is led by real estate sector.

In the Union Budget 2018-19, infrastructure allocation for the financial year 2018-19 has been increased by 20.9% YoY to Rs.5.97 lakh crore from Rs.4.94 lakh crore in the corresponding period a year ago. The government thus continues its push towards infrastructure and construction which is likely to drive the demand for steel in India during 2018-19, the sector being the largest consumer of steel in the country.

This segment involves industries such as capital goods, consumer durables, electrical goods, general engineering, defence equipment etc. Steel products including hot rolled coils & sheets are used in general engineering and galvanised sheets are used in consumer durables. The consumer durables market is expected to grow by 6.5%-8.5% YoY on account of improvement in domestic consumption during 2018-19.

This sector is a major demand driver for flat steel products (including basic and specialty steels). These products are key inputs for manufacture of automobiles and accounts for significant cost with respect to automobile production. Flat products such as hot rolled coils & sheets find their application in wheel-disc in the automotive segment. Other products like cold rolled coils & sheets and galvanised coils & sheets find their application in auto parts viz. hood, roof, door, body side, floor, reinforcement pillar, structural safety components and impact beam. The automobiles sector is expected to register higher sales on a YoY basis during 2018-19 backed by a growth in demand from auto consumers.

Sales of the largest segment, two & three wheelers, is likely to grow by 17%-19%, and sales of the commercial vehicles (CV) and passenger vehicles (PV) segments’ is expected to rise by 18%-20% and 8%-10%, respectively.

Subsequently, we expect the demand for steel from user industries to remain higher in the current financial year 2018-19 which is expected to drive steel production during the year. Thus, India’s steel production is expected to grow by 6%-8% during 2018-19.

During 2017-18, domestic steel prices remained buoyant as they rose in the range of 18%-21% on a YoY basis. The increase in prices was on account of a growth in domestic consumption and international prices. The movement in international steel prices generally have an impact on domestic steel prices. Besides, higher raw material prices also resulted in rise in steel prices.

The prices of CR coils, HR coils and TMT bars averaged at Rs 49,436 per tonne, Rs 46,075 per tonne and Rs 39,935 per tonne, respectively, during 2017-18. During 2016-17, the prices of CR coils and HR coils rose by 5%-11% and the prices of TMT bars declined by 3.5% on a YoY basis.

voda 19 juni 2018 15:29

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Deel 2:

The movement in international steel prices (that influences domestic steel prices) and raw material prices that had an impact on domestic steel prices during the year are explained below.

During the financial year 2017-18, the prices of HRC and CRC in China increased in the range of 18%-27% and the prices of plate and rebar grew by 31%-42% on a YoY basis. The growth in international steel prices also led to a rise in domestic steel prices during the year.

This rise in prices was on account of production cuts undertaken by China to improve the quality of air and handle pollution. In addition to this, improved demand for steel backed by Chinese government stimulus also supported the growth in prices. The improvement in prices during 2017-18 was over 29%-40% YoY growth reported by prices during 2016-17. The Chinese government has plans to cut down 100 to 150 million tonnes of annual steel production during the period 2016-2020.

The major raw materials used for the manufacturing of steel are coking coal and iron ore. While the demand for iron ore is majorly met domestically, coking coal is largely imported for manufacturing of steel. Around 85% of the coking coal requirements for domestic steel industry are fulfilled through imports as per National Steel Policy 2017.

India is mostly self-sufficient when it comes to meeting the requirements of iron ore for manufacturing of steel. Resultantly, the country does not depend much on iron ore imports. Exports accounted for about 15% of the total domestic production during 2016-17. As the country meets most of the iron ore requirements internally, the domestic iron ore prices are primarily influenced by the demand-supply situation in the country while the movement in international iron ore prices influences the domestic prices to some extent.

The average domestic iron ore prices (65% and above Fe lumps) surged by 41.1% YoY to Rs 3,328.8 per tonne during April 2017-February 2018 while the international prices (iron ore fines c.f.r. China 62% Fe) increased by 1.7% YoY to $69 per tonne during financial year 2017-18. In April 2017, the domestic prices of iron ore stood at Rs 3,003 per tonne which increased sequentially in the initial few months and then declined to a low of Rs 2,996 per tonne in August 2017. Following this, the prices continued to rise on m-o-m basis in each of the months during September 2017-February 2018 except for November 2017 where prices declined by a marginal 0.5% to Rs 3,256 per tonne. In February 2018, the prices touched a high of Rs 4,065 per tonne.

The domestic iron ore prices are believed to have increased on account of higher steel demand in the country. Also, suspension of operations at mines in Odisha due to non-payment of penalty for illegal extraction of ores also resulted in price hikes in January 2018.

During 2016-17, the international prices (iron ore fines c.f.r. China 62% Fe) averaged 30% higher on YoY basis at USD 67.8 per tonne backed by an improvement in international steel prices. The iron ore prices however fluctuated despite a rise in international steel prices during the financial year 2017-18. On a YoY basis, while the international iron ore prices averaged higher during the first half of 2017-18, they remained subdued during the second half of the year. Thus the prices were up by 1.7% YoY during 2017-18.

As per the World Bank April 2018 release, the iron ore prices are expected to average at $66.3 per dry metric ton during 2018 compared with $73.8 per dry metric ton during 2017, a fall of 10.2% YoY.

The price of coking coal imported by India from Australia averaged at USD 96.8 per tonne during the financial year 2015-16, YoY fall of 23.4%. However, the prices increased in the next year and averaged higher by 52.3% YoY to USD 147.4 per tonne partly on account of coal producing capacity cuts undertaken by China. During April 2017-February 2018, the prices increased by 36.3% YoY to average at USD 192.6 per tonne, this was on account of cyclone Debbie that disturbed coking coal supplies from Australia’s major mines and ports towards the end of March 2017.

The coking coal prices increased on m-o-m basis in most of the months during April 2017-February 2018. The prices fell by 13.9% m-o-m to average at $175.6 per tonne in July 2017. Following this, the prices increased amid fluctuations and averaged at $225.1 per tonne in February 2018. To a large extent, India depends on imports to meet the domestic coking coal requirements for manufacturing of steel.

As per the Budget 2018-19 released by the Australian government in May 2018, the spot price of metallurgical (coking) coal is assumed to fall over the June and September quarters of 2018 to reach $120 per tonne FOB in the December quarter 2018. The release cautioned that the commodity prices are volatile and the outlook for them remains a major uncertainty.

Steel prices in India remained higher during the first two months of the financial year 2018-19. For May 2018, the prices of CR coils, HR coils and TMT bars stood at Rs 61,537 per tonne, Rs 56,480.5 per tonne and Rs.49,925 per tonne, respectively. The prices were at their peak during the month. Considering this and a likely slowdown in construction and infrastructure activities in the coming months on account of monsoon, the prices may see some moderation on m-o-m basis. Post monsoon, we expect the prices to pick up and remain firm backed by higher domestic demand during the year. We do not expect much pressure from the raw material prices.

The domestic prices however could get impacted by the demand-supply situation in China the world’s largest steel producer). As per the World Steel Association’s short range outlook, steel demand in China is expected to remain flat in 2018. While the outlook for demand remains static for China, the movement in steel prices here can take a cue from the production cuts that the country undertakes in 2018.

In March 2018, the US imposed 25% and 10% import duty on foreign made steel and aluminium, respectively, in the name of national security and to protect the US from cheap imports. While Canada, Mexico and Euro-pean Union (EU) were earlier given exemptions till May 2018, the US withdrew these exemptions recently. How-ever, Argentina, Australia, Brazil and South Korea are indefinitely exempted from the import duty as they are believed to have adhered to some quotas.

Considering import duty imposition, the countries that rely on the US as an export market would consider finding new destinations for their exports which, in turn, may lead to oversupply of steel in the international market and may put some pressure on international steel prices outside the US. Given that the international steel prices are primarily influenced by demand-supply situation in China, the import duty hike is likely to have a restricted impact on international steel price movements.

Of the total steel exports by India during 2017-18, shipments to the US accounted for 3.1% of the total exports of finished steel in terms of value which stood at $301.6 million and accounted for 1.6% in terms of quantity that stood at 207.6 thousand tonnes during 2017-18. Thus, we expect that the imposition of import duty on India will have a marginal impact on steel exports from India.

voda 19 juni 2018 15:29

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Deel 3:

The finished steel exports from India have been on a rise for the past two years. The exports that stood at 4.1 million tonnes during 2015-16 almost doubled to 8.2 million tonnes during 2016-17 and increased by 16.7% YoY to 9.6 million tonnes during 2017-18. We expect the exports would continue to rise in the ongoing financial year 2018-19. Exports however declined by 25.2% YoY to 558 thousand tonnes in April 2018.”

Care added that “We expect the demand for steel from user industries to remain higher in the current financial year 2018-19 which is expected to drive steel production during the year. Thus, India’s steel production is expected to grow by 6%-8% during 2018-19.

*The domestic steel prices are expected to remain firm during the year 2018-19, while we may see some moderation in prices in the coming months on account of monsoon due to a likely slowdown in construction and infrastructure activities in these months. We do not expect much pressure from the raw material prices.

*The domestic prices however could get impacted by the demand-supply situation in China (the country being the largest steel producer) and the production cuts that the country undertakes in 2018.”

Source : Strategic Research Institute

voda 19 juni 2018 15:42

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India iron ore prices defied global trends to surge 41pct in FY18

Business Standard reported that prices of high-grade iron ore lumps, a key input in steel manufacturing, shot up 41.1 % year-on-year in FY18, belying international trends. Globally, benchmark prices of iron ore fines (62 Fe grade) inched up by only 1.7 % in last financial year to USD 69 per tonne.

An industry analyst said that “Domestic prices need not necessarily reflect international price movements and trends. Steel demand in the country remained robust for the most part of FY18 and this sustained higher ore prices. That apart, temporary suspension of a few iron ore mines in Odisha cut off supplies and triggered appreciation in iron ore prices towards Q4.”

The Supreme Court’s decree in a case of illegal mining in Odisha shunted seven operative iron ore mines, knocking off 23 million tonnes of annual capacity. The mines were shut as the leaseholders failed to meet the court-mandated December 31 deadline to fork out compensation for overproduction of ore between 2000-01 and 2010-11. Though the mines resumed operations two to three months later, the scenario triggered an artificial crisis, goading the largest producer, NMDC Ltd, to raise prices. A clutch of merchant miners in Odisha followed suit.

A report by CARE Ratings shows that domestic iron ore prices stood at INR 3,003 a tonne in April 2017. After recording sequential growth, prices sobered to INR 2,996 a tonne in August 2017. Thereafter, prices spiralled month-on-month between September 2017 and February 2018, save November when they fell marginally by 0.5 % to INR 3,256 a tonne. In February 2018, iron ore prices peaked at INR 4,056.

In contrast, international iron ore prices averaged higher during the first half of 2017-18 but softened in the second half. On an average, global prices were up 1.7 % y-o-y in 2017-18. According to a World Bank release in April 2018, international iron ore prices are expected to average USD 66.3 a tonne during calendar 2018 compared with USD 73.8 in 2017, denoting a slide of 10.2 % y-o-y.

Domestically, iron ore output scaled a decade high of 210 million tonnes in 2017-18. Production of steel, the largest consuming industry of iron ore, grew by 3.1 % to 105 million tonnes whereas consumption of the metal rose 7.9 % to 90.7 million tonnes.

In the current financial year, the country’s steel output is seen growing in the range of 6-8 per cent as an anticipated higher demand will fuel production. The report by CARE Ratings does not foresee much pressure from the raw material prices on the steel companies.

Source : Business Standard

voda 19 juni 2018 15:44

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Rio Tinto’s iron ore business delivering value through additional flexibility

In a presentation to investors and analysts in Perth, Rio Tinto showcased its Pilbara operations, a world-class, leading-edge, fully integrated system. The presenters discussed how Rio Tinto's Iron Ore business will continue to deliver superior value for shareholders by developing greater flexibility across its system of mines, rail and ports in Western Australia, capable of dynamically responding to changes in market and customer demand. Rio Tinto Iron Ore chief executive Chris Salisbury said "Our strategy is to optimise our Pilbara assets to deliver value for our shareholders. Our Iron Ore business delivered $7.3 billion of free cash flow in 2017 and we will continue to maximise free cash flow by pursuing a value-over-volume approach, built on a portfolio of world-class assets that deliver our premium iron ore product, the Pilbara Blend. We are driving productivity improvements right across the business and we continue to leverage considerable value from innovation and new technology. Our pioneering autonomous rail project, AutoHaul®, is on schedule to be implemented by the end of the year, and is already delivering benefits to the business through an uplift in rail capacity.

"Removing our bottleneck in rail and increasing flexibility remain a key priority. This work is progressing well and rail and mine capacity should be in line with nameplate port capacity by the end of 2019. As we have said before, we will continue to optimise the system to provide the flexibility to respond to market conditions. However, importantly, capacity is not the same as tonnes shipped. How we use the capacity of our integrated system will be dynamic, in line with a strict value-over-volume approach.

"We have an extensive pipeline of future development options, which we continue to grow. In 2018, our 700 kilometre drilling programme will provide both ongoing reserve replenishment and significant optionality to optimise operations."

More than 4,500 mine-to-market productivity initiatives are being pursued in Iron Ore, delivering $500 million in additional free cash flow per year by 2021 as part of an annual Group-wide target of $1.5 billion. The company's productivity and cash focus are increasingly important to offset early signs of cost inflation which are returning to the industry.

The Group's sector-leading application of new technology will also be discussed, including the continued successful roll out of automation, with 95 autonomous trucks and 11 autonomous drills already in operation. Work is progressing on the feasibility study for the Koodaideri project, designed to be the first mine to take full advantage of all these innovations.

Mr Salisbury added the company continues to benefit from changes in the Chinese steel industry.

Other key points from the presentations include:

Resource and mine development
• A large drilling programme for 2018 is scheduled, with 700 kilometres of drilling scheduled at various operational hubs near existing mines in addition to exploration on new leases.
• The Koodaideri feasibility study continues to progress. The project underpins the Pilbara Blend product and should be a low-cost operation with significant capacity optionality.
• Expected spending of ~$2.2 billion on replacement mines over the next three years including initial spending on the Koodaideri, West Angelas and Robe Valley developments.
• The $118 million Billiard South sustaining project is in development, helping to support Yandicoogina operations. Production is expected to commence in 2019.

Operations
The Silvergrass mine continues to ramp up to its 21Mtpa capacity, running at an annualised rate of 15.3Mtpa at end of the first quarter of 2018.
Sustaining capital spending of ~$1 billion per year for the next three years in the Pilbara.
The pioneering AutoHaul® project is building future system flexibility. Following regulatory approval received in May, full implementation of the autonomous programme is anticipated by the end of 2018.
Rail and mine capacity is expected to match nameplate port capacity by the end of 2019.
The rail productivity programme, targeting every part of the rail system, will deliver additional capacity and flexibility to underpin our optimised supply chain design.

Sales and marketing
China's steel industry is undergoing a structural change.
Removal of less efficient steel-making capacity and strong demand is supporting steel pricing and currently provides a robust backdrop for high quality iron ore.
Shipment guidance for 2018 remains unchanged at between 330 million and 340 million tonnes.

Source : Strategic Research Institute

voda 20 juni 2018 16:29

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Trump Trade War - Escalating as Trump threatens with more tariffs

BBC reported that US President Donald Trump has threatened to impose tariffs on an additional USD 200 billion of Chinese goods in a growing trade row. Mr Trump insists that China has been unfairly benefiting from a trade imbalance with the US for years and said "Rather than altering those practices, it is now threatening United States companies, workers, and farmers who have done nothing wrong. New tariffs would go into effect if China refuses to change its practices, and also if it insists on going forward with the new tariffs that it has recently announced.’

He added "If China increases its tariffs yet again, we will meet that action by pursuing additional tariffs on another USD 200 billion of goods."

Last week, Mr Trump confirmed that the US would impose 25% tariffs on USD 50 billion worth of Chinese goods.

China's commerce ministry reacted swiftly, saying "If the US acts irrationally and issues a list, China will have no choice but to take comprehensive measures of a corresponding number and quality and take strong, powerful countermeasures."

US-China trade war timeline
January 2018 - The US announces tariffs on imported solar panels and washing machines
March - Mr Trump unveils plans for a 25% tariff on steel imports and a 10% charge on aluminium
April - China announces tariffs on US imports ranging from 15% to 25% on goods ranging from steel pipes to pork
May - The US and China put tariff plans "on hold" after talks
June - Mr Trump decides to push on with plans to impose tariffs in July.

Source : BBC

voda 20 juni 2018 16:33

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Trump Trade War - Russia to impose duties on US products

Sputnik reported that Russia will seek to retaliate against Washington’s unilaterally imposed steel & aluminum tariffs against Russia and other producers. Russian Economic Development Minister Maksim Oreshkin said that these measures will only affect products that have analogues in Russia. He said ‘Because the US continues to apply protective measures in the form of additional import duties on steel and aluminum and refuses to provide compensation for Russia's losses, Russia is using its WTO rights and introducing balancing measures with respect to imports from the United States.’

He said “Such measures in the form of additional import duties on American goods will be applied in the near future.’

He added "They will only affect products that have substitutes on the Russian market and will not have a negative impact on macroeconomic indicators.’

Source : Sputnik

voda 20 juni 2018 16:33

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Trump Trade War - May lead to a collapse of order in global trade - JISF

Reuters reported that Japan Iron and Steel Federation Chairman Mr Koji Kakigi told a news conference that he is worried that an escalating trade spat between the United States and China would lead to a collapse of order in global trade. He told “Rising trade tensions between the two countries were a matter of great concern. If intensifying trade conflicts trigger further import duties, that may lead to a collapse of order in global trade at its core.’

Mr Kakigi, who is also president of JFE Steel, a unit of JFE Holdings Inc, added that it would be a serious problem if the World Trade Organization’s framework for trade was undermined.

However, Mr Kakigi, said that US import duties on steel that were imposed in March had not had any major impact on Japanese steel exports to the United States.

Source : Reuters

voda 20 juni 2018 16:35

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SAIL supplies steel for world tallest girder rail bridge and longest tunnel in Manipur

Steel Authority of India Ltd (has supplied around 60,000 tonnes of steel material for the 111-km-long Jiribam-Tupul-Imphal new broad gauge railway project. The project was taken up in 2008 and was declared a National Project. Northeast Frontier Railway is undertaking the construction of the project in Manipur, India. SAIL has supplied mainly TMT rebars and Structurals along with HR Plates and Sheets, Plate Mill Plates, etc. for this project, which bears the distinction of having in its ambit construction of not only India’s longest tunnel but also the tallest girder rail bridge in the world. SAIL’s Branch Sales Office at Guwahati has been supplying the materials which are produced from its state-of-the-art new mills at Durgapur, IISCO, Rourkela and Bokaro steel plants

The project involves the construction of 111-km long broad gauge railway line which includes 9 stations along the way at Dolakhal, Kaimai Road, Kambiron, Thingou, Khongsang, Noney Tupul, Haochang Road and Imphal, 148 bridges & 45 tunnels (of which Tunnel No. 12 is 11.55-km long, making it India’s longest tunnel).

In addition to this, a bridge is being constructed near Noney which will become the tallest girder rail bridge in the world. At 141 metres, the bridge over river Iring river will be as high as two Qutub Minars stacked on top of each other.

The project is being developed in two sections. The first section involves the construction of 84 kms of railway line connecting Jiribam to Tupul which is on the verge of completion. The second section of 27 kms connecting Tupul to Imphal is expected to be completed by 2019.

Source : Strategic Research Institute

voda 20 juni 2018 16:37

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Nissan Motors to expand usage of ultra high strength steel to reduce emissions

Nissan Motor Co Ltd will build more models using a new type of steel that combines high tensile strength with a previously unachievable degree of formability, resulting in lighter vehicles that can help lower emissions while protecting occupants. Nissan is the world’s first carmaker to use the high-formability steel, with a tensile strength of 980 megapascals, which was jointly developed by Nissan and Nippon Steel & Sumitomo Metal Corp. The steel’s combination of stamping formability and strength makes it possible to form parts with complex shapes that are thinner and lighter than those made of conventional high tensile strength steel, while maintaining the ability to absorb energy in a collision.

The INFINITI QX50 premium midsize SUV, which went on sale in the U.S. in March, is the world’s first vehicle with front and rear side members made from 980-megapascal ultrahigh tensile strength steel, along with other body frame parts. Nissan plans to expand the use of the material, which enhances fuel efficiency as well as driving performance by lowering vehicle weight, to other models.

Nissan launched a sustainability plan this month that calls for lowering CO2 emissions from its new vehicles by 40% by fiscal year 2022, compared with fiscal year 2000. The company is aggressively developing technologies to expand the use of ultrahigh tensile strength steel, aiming for it to make up 25% of the company’s vehicle parts by weight. The material makes up 27% of the new QX50.

The 980-megapascal steel developed with Nippon Steel & Sumitomo Metal can be cold-pressed, making it suitable for mass production. This will help contain increases in vehicle cost.

Source : Strategic Research Institute

Bijlage:

voda 20 juni 2018 16:39

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Trump Trade War - US pipeline companies seek exemption

World Pipelines reported that several major US energy companies including Plains All American Pipeline, Hess Corp and Kinder Morgan Inc are among many seeking exemptions from steel import tariffs as the US ratchets up trade tensions with exporters including China, Canada and Mexico. There have been nearly 21 000 requests overall for exclusions submitted to the US Commerce Department since the Trump administration imposed levies this year. Of those, more than 500 petitions involve pipes and related materials.

Initial decisions are expected this month, offering the first clues as to how the administration will balance an agenda favouring oil and gas exports while also supporting the US steel and aluminium industries.

The pipeline industry could face higher costs from tariffs as about 77% of the steel used in US pipelines is imported, according to a 2017 study for the pipeline industry.

Source : World Pipelines

voda 20 juni 2018 16:40

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Tangshan awarded order to Primetals Technologies to expand existing condition monitoring system

Tangshan Iron and Steel Group Co Ltd a Chinese steel producer, has awarded Primetals Technologies an order to further expand the existing condition monitoring system, which was also implemented by Primetals Technologies, in cold rolling mill no. 2 at its Tangshan plant in Hebei Province. In future, the expanded system will also be used for the condition monitoring of two new continuous galvanizing lines supplied by Primetals Technologies. Since 2017 the CMS has been monitoring an existing galvanizing line, a continuous annealing line and a coupled tandem pickling line in cold rolling mill no. 2, as well as a hot strip mill. The CMS is intended to increase the availability of the plant, reduce maintenance costs, help to optimize production planning, and provide a consistently high product quality.

With cross-plant condition monitoring, Tangshan is taking an important step towards Industry 4.0 and to technological leadership in the field of predictive maintenance. The expanded CMS is scheduled to come into operation at the end of 2018.

The CMS monitors not only the mechanical equipment but also the mechatronic systems and technological controls, process models and third-party systems. For the expansion of the condition monitoring system, Primetals Technologies will supply sensor packages, servers and special software packages. These include over a hundred permanently installed and mobile packages to measure and analyze vibrations, packages for fast connections to local CPUs, and packages for monitoring the roller tables and data from the basic automation (Level 1). The collected data is available centrally in a maintenance center, at operator stations or for remote access. An interface to the Enterprise Resource Planning (ERP) system for machine data synchronization, work orders and feedback from maintenance activities was also implemented.

Tangshan Iron and Steel is part of the HBIS Group Co., Ltd., China ?s largest steel producer with an annual production of over 46 million metric tons in 2016. The Tangshan production site has been in operation for over 70 years. In recent years, Primetals Technologies has supplied an AOD converter, a vacuum decarburization plant and a continuous galvanizing line to Tangshan, and also coupled the tandem cold rolling mill to the existing pickling line.

Source : Strategic Research Institute

Bijlage:

voda 20 juni 2018 16:42

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ArcelorMittal launches Steligence, a radical and disruptive construction industry concept

ArcelorMittal has unveiled a radical new concept for the use of steel in construction, which will facilitate the next generation of high performance buildings and construction techniques and create a more sustainable life-cycle for buildings. Known as Steligence®, the concept revolves around the idea of buildings as holistic entities where all aspects of design are considered in an integrated way, as part of the whole. As such, it proposes the need for better dialogue between various specialist architectural and engineering disciplines, recognizing not only specialist expertise, but also the need for enhanced co-operation between experts. Steligence® further suggests that the use of best available technology in steelmaking, as well as modularization of steel components in buildings where possible, has the capacity to generate efficiency gains in the design, construction and configurability of buildings as compared to those using traditional construction methods.

Additionally, because steel is infinitely recyclable, Steligence® sets the stage for architects to consider the life-cycle, recyclability and, ultimately, re-usability of a building and its components at the earliest point in the design process.

This new approach to construction from ArcelorMittal has been brought about by real advances in technology which now make steel an even more attractive material for construction than was previously the case. As such, the Steligence® concept has the potential to drive significant architectural and sustainability benefits.

These benefits include more building storeys within a given height than is the case with traditional building systems and materials; less deep and therefore less costly foundations due to the lower weight of steel buildings compared with traditional materials; and far longer uninterrupted spans between columns, resulting in much better flexibility of interior floor layout.

In addition, buildings designed using the Steligence® philosophy will be easier to assemble (and potentially disassemble) and therefore quicker to build, leading to significant efficiencies and cost savings for the construction sector.

While steel’s infinite recyclability potential is clearly superior to that of alternative materials, even then there are associated costs given the energy necessary to melt and re-form. In this context, design where possible using modular steel components can enable re-use rather than re-cycling of steel components in new buildings at the end of life of the original building. This ‘re-use’ possibility gives steel a huge advantage over traditional building materials, particularly as regulations strengthen regarding the sustainability credentials of buildings.

Steel already plays a big role in the circular economy. Steligence® will enable the construction industry and buildings themselves to play an even more significant role in it.

Source : Strategic Research Institute

Bijlage:

voda 20 juni 2018 16:43

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Growth in Indian manufacturing sector to sustain demand for steel

Mr Sushim Banerjee DG of INSDAG in his personal capacity wrote that the trend of manufacturing sector and for that matter the behaviour of industrial production in India since December 2017 has been a matter of satisfaction for all other industrial segments, including steel.

The trend of manufacturing sector and for that matter the behaviour of industrial production in India since December 2017 has been a matter of satisfaction for all other industrial segments, including steel. It was earlier pointed out in this column that growth in steel consumption in the country is crucially dependent on more investment in construction and infrastructure sectors that account for nearly 62% of steel consumption. It was noted that subdued performance (even negative growth in manufacturing and industrial output in some of the months in last year) would undermine the growth potential in construction due to non availability of matching support to the growth in infrastructure sector. Thus, one may argue that if poor growth would not have plagued the manufacturing and infrastructure sectors (accounting for nearly 38% of steel consumption), our steel consumption would have attained a higher growth path.

Exports of engineering goods in which machinery and equipment are the major components have declined in the recent past as a testimony to poor growth in manufacturing sector and thereby adversely affecting steel demand. In October 2017, manufacturing and IIP observed 2.5% and 2.2% growth over last year. This became 4.4% in March 2018 and now April data shows that the same has moved up by 5.2% and 4.9%. What is interesting to note is that all steel intensive segments like capital goods have risen by 13%, consumer durable by 4.3%, infrastructure and construction sectors by 7.5%. More specifically the growth in manufacture of vehicles and trailers grew by as high as 21.9%, manufacture of machinery and equipment by 8.5%, manufacture of other transport (rails, ships, aircrafts) by 13.9% and manufacture of furnitures by 10.3% during the month. The growth in industrial output is well reflected in consumption of specific products.

While the growth in long products (TMT, Structurals, Rails) can directly be linked with infra and construction demand, the growth in flat categories is mostly linked with manufacturing growth. Demand for wire rods is mostly connected with growth in manufacturing sector. Thus, during April 2018, although the consumption of TMT/ wire rods has marginally gone down, demand for Railway materials rose significantly. Demand for HRC, plates, CRC, coated products has also grown by an average 12.5%. This phenomenon is directly linked with growth in manufacturing. It is also observed that higher imports in HRC, plates and coated products have contributed to growth in consumption in these categories. As the demand scenario is brightened, the question comes if domestic producers could have supplied the higher import volumes.

If the choice of the purchasers centres on prices only and if the imports are arriving taking advantage of lower import duties (as the trigger prices on HR, plates, CR, wire rods following AD investigation are ineffective), the matching of the landed prices is essential. For this purpose, it is imperative that an adequate import monitoring mechanism is installed early to support the indigenous producers with pre-arrival information to be able to face the challenge. Indian producers are left with sudden shocks after the arrival of the materials with no prior knowledge about the extent of the damage. The system has been set up quite successfully in many developed countries like the US. During April-May 2018, India exported 1.27 million tonne of steel which is 0.136 million tonne lower as compared to imports.

India has achieved export growth in plates, HR, coated products and ESS. The consumption of electrical steel sheets has gone up by 59% in April 2018 as compared to last year, largely contributed by higher imports of CRGO as supply from domestic sources is minimal. WPI just released for the month of May 2018 indicates 4.43% growth annually over last year. This has largely been triggered by the rise in crude prices that has a strong multiplier impact on food and commodity prices, primarily through higher transport costs. The manufacturing prices have gone up by 3.73% and specifically the iron and steel semis prices by 12.1%.

Categorywise, the maximum price rise is observed in respect of WPI of coated products that rose by 12.6%. Logically the rise in crude oil prices would imply more pressure on rail transport by steel, coal and cement sectors. With current rise in crude prices, the supply chain and logistics scenario are changing in favour of more localised supplies, more thrusts on bulk supply via rakes and more demand for loose wagon supply from Railways where direct bulk delivery is not possible. With the picking up of consumer demand and stability in the flow of investment in infra, the manufacturing growth is likely to continue unabated. China, despite all major changes being implemented in the structure of the economy, is exhibiting an average industrial growth of 6%. There is no reason why India cannot exceed this rate in the coming months.

Source : Financial Express

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