Monday, October 30, 2006
Industries at odds over steel tariffs
There's nothing in here that long time readers of this blog don't already know, but I find it interesting that these things are now making it to places like the LA Times.
Cutting costs has become a way of life at Aggressive Engineering Corp., a Southern California metal stamping company.
Over the last decade, President Dan Bridges has slashed his workforce from 52 to 25, capped wages and retooled the assembly line to increase its output of metal parts.
But Bridges said he might have to close his doors if the U.S. government doesn't lift the duties imposed in 1993 on foreign firms accused of dumping cheap steel in the U.S. market.
Those duties, he said, have contributed to a doubling in the price of galvanized steel, which accounts for 70% of his company's costs.
Cutting costs has become a way of life at Aggressive Engineering Corp., a Southern California metal stamping company.
Over the last decade, President Dan Bridges has slashed his workforce from 52 to 25, capped wages and retooled the assembly line to increase its output of metal parts.
But Bridges said he might have to close his doors if the U.S. government doesn't lift the duties imposed in 1993 on foreign firms accused of dumping cheap steel in the U.S. market.
Those duties, he said, have contributed to a doubling in the price of galvanized steel, which accounts for 70% of his company's costs.
Thursday, October 19, 2006
2nd final offer
It seems I wasn't the only one to find this AK issued wording odd:
Analyst Beth Gaston Moon wrote:
(side note: is 'second final' an oxymoron? Discuss.)
Analyst Beth Gaston Moon wrote:
(side note: is 'second final' an oxymoron? Discuss.)
Locked-out workers reject AK Steel pact
Akron Beacon Journal
Union workers at AK Steel's Middletown Works rejected a contract offer Wednesday that would have ended a lockout in its eighth month, union officials said.
and this fairly comprehensive time line of the AK Steel Lockout
Union workers at AK Steel's Middletown Works rejected a contract offer Wednesday that would have ended a lockout in its eighth month, union officials said.
and this fairly comprehensive time line of the AK Steel Lockout
Tuesday, October 17, 2006
US automakers rev up campaign against steel duties
Big fight brewing here.
At heart is the question, what are 'unfair' pricing practices? And what are reasonable counter measures.
From the perspective of a metal stamper, the current situation is that, for certain materials, my customers can buy finished parts for less than my raw material cost. So keeping the tarrifs in place means that people buy the finished part offshore, bypassing both the steel production that the steel companies claim they care about and the downstream jobs and value added. This is the distorting effect of tarrifs ... my competition has lower input costs than I do.
Yahoo! News
Six of the world's biggest carmakers backed a cross-party drive by US senators to scrap controversial duties on a type of steel used extensively in the auto industry.
DaimlerChrysler, Ford, General Motors, Honda, Nissan and Toyota all endorsed a letter sent to the ITC from 10 US Republican and Democratic senators, who argued the steel industry had changed dramatically since 1993.
"In fact, the assets of the 14 US companies that produced corrosion-resistant steel in 2000 are now owned by only six companies, and the market is dominated by just three," the senators' letter said.
"Since the steel industry is now prospering, restrictions should be lifted to restore the competition to the marketplace," it added.
"Failure to do so would threaten the sector of the US economy that uses this same product as a raw material, namely the automotive industry."
In a joint statement, the automakers said they bought the "overwhelming amount" of the steel used in their US operations from American mills.
But noting that the US car industry employs 2.4 million people, the companies said they "must maintain the ability to obtain key materials for their vehicle assembly plants dependably and at globally competitive prices".
US steelmakers and unions have banded together to take out full-page newspaper advertisements demanding that the ITC renew the duties. "Don't let America's steelworkers get run over by the auto companies," the ad says.
The ad quoted a Commerce Department report that said if the duties were lifted, foreign corrosion-resistant steel would flood the US market at up to 36 percent below the fair market price.
But critics including the automakers accuse the steel industry of using wildly distorted figures that are based on the import pattern of the early 1990s.
And since then, the massive growth of countries like China means that global demand for steel has rocketed to ensure double-digit earnings growth for US steelmakers, the critics note.
At heart is the question, what are 'unfair' pricing practices? And what are reasonable counter measures.
From the perspective of a metal stamper, the current situation is that, for certain materials, my customers can buy finished parts for less than my raw material cost. So keeping the tarrifs in place means that people buy the finished part offshore, bypassing both the steel production that the steel companies claim they care about and the downstream jobs and value added. This is the distorting effect of tarrifs ... my competition has lower input costs than I do.
Yahoo! News
Six of the world's biggest carmakers backed a cross-party drive by US senators to scrap controversial duties on a type of steel used extensively in the auto industry.
DaimlerChrysler, Ford, General Motors, Honda, Nissan and Toyota all endorsed a letter sent to the ITC from 10 US Republican and Democratic senators, who argued the steel industry had changed dramatically since 1993.
"In fact, the assets of the 14 US companies that produced corrosion-resistant steel in 2000 are now owned by only six companies, and the market is dominated by just three," the senators' letter said.
"Since the steel industry is now prospering, restrictions should be lifted to restore the competition to the marketplace," it added.
"Failure to do so would threaten the sector of the US economy that uses this same product as a raw material, namely the automotive industry."
In a joint statement, the automakers said they bought the "overwhelming amount" of the steel used in their US operations from American mills.
But noting that the US car industry employs 2.4 million people, the companies said they "must maintain the ability to obtain key materials for their vehicle assembly plants dependably and at globally competitive prices".
US steelmakers and unions have banded together to take out full-page newspaper advertisements demanding that the ITC renew the duties. "Don't let America's steelworkers get run over by the auto companies," the ad says.
The ad quoted a Commerce Department report that said if the duties were lifted, foreign corrosion-resistant steel would flood the US market at up to 36 percent below the fair market price.
But critics including the automakers accuse the steel industry of using wildly distorted figures that are based on the import pattern of the early 1990s.
And since then, the massive growth of countries like China means that global demand for steel has rocketed to ensure double-digit earnings growth for US steelmakers, the critics note.
Marinrea buys Automotive parts giant Thyssen-Krupp Budd
TorontoSun.com
Canadian auto parts company Martinrea International Inc. has agreed to buy the North American automotive body and chassis operations of Germany-owned Thyssen-Krupp Budd Co. for $275 million US in a major deal that nearly triples the company's revenue and doubles its workforce.
Vaughan-based Martinrea said yesterday it will pay $95 million US in cash and the balance in assumed liabilities for the ThyssenKrupp Budd assets, part of German industrial giant ThyssenKrupp AG, a large international maker of steel, industrial machinery and automotive products.
ThyssenKrupp Budd,based in Troy, Mich., makes metal forming for the auto industry including body stamping, metallic welded assemblies, hot metal stampings, automotive sheet-metal stamping and the module assembly of chassis component parts.
Canadian auto parts company Martinrea International Inc. has agreed to buy the North American automotive body and chassis operations of Germany-owned Thyssen-Krupp Budd Co. for $275 million US in a major deal that nearly triples the company's revenue and doubles its workforce.
Vaughan-based Martinrea said yesterday it will pay $95 million US in cash and the balance in assumed liabilities for the ThyssenKrupp Budd assets, part of German industrial giant ThyssenKrupp AG, a large international maker of steel, industrial machinery and automotive products.
ThyssenKrupp Budd,based in Troy, Mich., makes metal forming for the auto industry including body stamping, metallic welded assemblies, hot metal stampings, automotive sheet-metal stamping and the module assembly of chassis component parts.
Chinese Wage Growth Surging, But Hasn't Fueled Higher Prices
Yahoo News
Competition for managers, engineers and other highly skilled labor is especially intense and job-hopping for higher pay is rampant.
'Wages in China are definitely going up at a fast pace,' said Behlen Chairman Tony Raimondo. 'The movement of land value and wages has surprised many of us.'
Competition for managers, engineers and other highly skilled labor is especially intense and job-hopping for higher pay is rampant.
'Wages in China are definitely going up at a fast pace,' said Behlen Chairman Tony Raimondo. 'The movement of land value and wages has surprised many of us.'
AK workers given 'final' offer
Somehow it doesn't sound quite so 'final' the second time.
Pittsburgh Tribune-Review
About 1,800 union workers locked out of AK Steel's Middletown Works in Ohio for more than seven months are to vote Wednesday on a contract the company has said is its final offer. Workers voted down AK's last proposal, which the company also called a final offer, on Sept. 25 by 54 percent to 46 percent, union officials said. Since then, the company has reworked its wording of back-to-work conditions, including promising a 40-hour work week within one week of an employee's callback.
Pittsburgh Tribune-Review
About 1,800 union workers locked out of AK Steel's Middletown Works in Ohio for more than seven months are to vote Wednesday on a contract the company has said is its final offer. Workers voted down AK's last proposal, which the company also called a final offer, on Sept. 25 by 54 percent to 46 percent, union officials said. Since then, the company has reworked its wording of back-to-work conditions, including promising a 40-hour work week within one week of an employee's callback.
Monday, October 16, 2006
U.S. Steel loses bid to move steel coil case out of Alabama court
We've commented on this situation before. It seems to be progressing (slowly) through the courts. Does anyone understand why they load the coils eye to the side rather than eye to the sky?
Pittsburgh Business Times
Officials in Alabama have been seeking a solution for a public safety hazard in which 22-ton coils of steel produced by the company's Fairfield Works are falling off of flat-bed trucks in the Birmingham area. In the most recent case, a truck traveling the interchange from Interstate 59 to I-20 on Oct. 2 lost a steel coil and the 22-ton roll of metal struck and damaged a freeway retaining wall. There were no injuries in the incident, but there have been three such security failures, involving a total of five coils, since June alone. On June 8, a motorist was injured when her car struck one of the fallen coils.
Pittsburgh Business Times
Officials in Alabama have been seeking a solution for a public safety hazard in which 22-ton coils of steel produced by the company's Fairfield Works are falling off of flat-bed trucks in the Birmingham area. In the most recent case, a truck traveling the interchange from Interstate 59 to I-20 on Oct. 2 lost a steel coil and the 22-ton roll of metal struck and damaged a freeway retaining wall. There were no injuries in the incident, but there have been three such security failures, involving a total of five coils, since June alone. On June 8, a motorist was injured when her car struck one of the fallen coils.
Thursday, October 12, 2006
LME Says There's No Evidence Copper Was Buoyed by Speculation
Bloomberg.com
The London Metal Exchange, the world's largest marketplace for aluminum and copper, said it found no evidence that copper's price gains were artificially buoyed by speculation.
And yet ... that's not really what he was quoted as saying.
Not a shred of evidence has been presented
Gains in copper were from demand and supply in the market, ``not by any mischief on the LME,'' Brydon said.
No evidence presented is not the same as it didn't happen.
And "no mischief at the LME" is not the same as speculation played no role in the runup in prices.
So I found this a very strange article, leaving more questions than answers.
The London Metal Exchange, the world's largest marketplace for aluminum and copper, said it found no evidence that copper's price gains were artificially buoyed by speculation.
And yet ... that's not really what he was quoted as saying.
Not a shred of evidence has been presented
Gains in copper were from demand and supply in the market, ``not by any mischief on the LME,'' Brydon said.
No evidence presented is not the same as it didn't happen.
And "no mischief at the LME" is not the same as speculation played no role in the runup in prices.
So I found this a very strange article, leaving more questions than answers.
Labels: Copper
Jobs lost at Lapeer Metal
The County Press
Citing unforeseen economic conditions in the automobile manufacturing industry, particularly at General Motors and Ford, Lapeer Metal Stamping recently gave 87 employees notice they will soon be out of a job
Citing unforeseen economic conditions in the automobile manufacturing industry, particularly at General Motors and Ford, Lapeer Metal Stamping recently gave 87 employees notice they will soon be out of a job
Wednesday, October 11, 2006
NAM Board Votes In Favor Of Multinationals In Debate Over China's Currency; Domestic Manufacturers Are Left Wondering What To Do
It's beginning to look like NAM is thinking of itself as NABMM - National Association of Big Multinational Manufacturers.
While I'm not a big fan of protectionism, I'm even a smaller fan of currency manipulation. During the second world war, currency manipulation was used as a weapon of war. And it's not clear to me that the current situation is all that different (except that there isn't a side-by-side de-facto war going on).
I know the blogger in chief over at NAM reads this blog. I wonder if he'd like to hit the reply button and comment on this article. Has NAM really abandonned the small, domestic manufacturer?
manufacturingnews.com
For members of the National Association of Manufacturers' Domestic Manufacturers Group, September 28 will be a day to remember. Their two-year effort to persuade NAM to endorse a currency manipulation bill was rejected by the association's executive committee and board of directors. Members of the Domestic Manufacturers Group (DMG) claim the loss was the result of opposition from the large multinational corporations that benefit from China's pegged currency working in concert with NAM's senior leaders intent on quashing an uprising. NAM leaders counter that the legislation was not going to force a sovereign nation of 1.3 billion to change its policies any time in the near future.
The NAM board vote is not sitting well with many of the domestic manufacturers that put so much emotional energy into the initiative. These companies -- particularly in the metal forming industries -- are struggling to remain competitive with the multinationals' Chinese production and Chinese suppliers. They believe that the multinational companies are the real "protectionists" -- defending unfair subsidies that the Chinese government is erecting in their favor, especially a currency that is estimated to be at least 25 percent, and perhaps as much as 60 percent, undervalued.
In an e-mail sent to NAM president Gov. John Engler, Nucor chairman and CEO Dan DiMicco said, "John -- You just don't get it." NAM's refusal to acknowledge unfair trade as being the primary cause of declining U.S. industrial competitiveness is a "blatant stab in the back" to domestic manufacturers, DiMicco wrote Engler. NAM's efforts "have shown us that the current NAM does not represent domestic manufacturing interests [...]
While I'm not a big fan of protectionism, I'm even a smaller fan of currency manipulation. During the second world war, currency manipulation was used as a weapon of war. And it's not clear to me that the current situation is all that different (except that there isn't a side-by-side de-facto war going on).
I know the blogger in chief over at NAM reads this blog. I wonder if he'd like to hit the reply button and comment on this article. Has NAM really abandonned the small, domestic manufacturer?
manufacturingnews.com
For members of the National Association of Manufacturers' Domestic Manufacturers Group, September 28 will be a day to remember. Their two-year effort to persuade NAM to endorse a currency manipulation bill was rejected by the association's executive committee and board of directors. Members of the Domestic Manufacturers Group (DMG) claim the loss was the result of opposition from the large multinational corporations that benefit from China's pegged currency working in concert with NAM's senior leaders intent on quashing an uprising. NAM leaders counter that the legislation was not going to force a sovereign nation of 1.3 billion to change its policies any time in the near future.
The NAM board vote is not sitting well with many of the domestic manufacturers that put so much emotional energy into the initiative. These companies -- particularly in the metal forming industries -- are struggling to remain competitive with the multinationals' Chinese production and Chinese suppliers. They believe that the multinational companies are the real "protectionists" -- defending unfair subsidies that the Chinese government is erecting in their favor, especially a currency that is estimated to be at least 25 percent, and perhaps as much as 60 percent, undervalued.
In an e-mail sent to NAM president Gov. John Engler, Nucor chairman and CEO Dan DiMicco said, "John -- You just don't get it." NAM's refusal to acknowledge unfair trade as being the primary cause of declining U.S. industrial competitiveness is a "blatant stab in the back" to domestic manufacturers, DiMicco wrote Engler. NAM's efforts "have shown us that the current NAM does not represent domestic manufacturing interests [...]
AK Steel presents new offer
Well, it's good they're talking again.
The Cincinnati Enquirer
AK Steel on Tuesday presented a revised contract offer to negotiators for 1,800 Middletown Works employees, with changes aimed at overcoming concerns that led to the proposal's defeat Sept. 25.
The company asked negotiators for International Association of Machinists Local 1943 to review the revised five-year contract proposal, provide a tentative agreement and recommend passage by the workers locked out eight months ago.
The company didn't put an expiration date on the revised proposal, unlike its original offer, which expired after union members rejected it 998-768.
In related news, I didn't report this at the time, but (from the same article)
Butler County Sheriff Rick Jones publicly called for an end to the lockout, saying its ripples were creating more work for his department.
The number of sheriff's sales for homes and personal property is up 13 percent since the lockout began, compared with the same period last year.
In the article I read, he took out a half page ad in a local paper, more or less saying that AK Steel needed to act. He was criticized for appearing to take sides, but defended his actions by saying it was a lockout, so it was the companies turn to move.
As a result, Company May Not Sponsor Sheriff's Conference As In Previous Years
The ad was paid for by Jones' campaign fund. He is not up for re-election this year.
In another article I saw on the weekend, he said he's an elected official and always up for re-election.
Interestingly enough, the steel workers at AK have set up a web site and a bulletin board system to keep themselves informed (a great idea, by the way). In the early days, it was publicly viewable, and I read some interesting stuff about how they were concerned for the safety of the replacement workers, reviewing fragmentary information they were hearing about workplace safety, etc. Now, however, you have to be a member to join, and all the forums are closed, even to viewing, from the outside.
Somewhere in there is a link to my blog, because I see the hits in my server statistics, but when I go to see what's being said, I can't. Oh, well, can't comment on what I can't see.
At the same time, and in the back of everyone's mind in this situation, I'm sure, Analysts See Weaker Steel Prices in 4Q
Strength in commercial trucking, manufacturing and fabrication sectors have helped curb concerns in the industry over the slumping housing market and problems at the nation's largest automakers. However, analysts say steel service center inventories are on the rise and it may not be long before the mills -- where business has so far retained its strength -- will see a drop in orders.
Mittal Steel USA said last week it will idle two plants that make light flat-rolled products in order to bring production in line with reduced demand.
The Cincinnati Enquirer
AK Steel on Tuesday presented a revised contract offer to negotiators for 1,800 Middletown Works employees, with changes aimed at overcoming concerns that led to the proposal's defeat Sept. 25.
The company asked negotiators for International Association of Machinists Local 1943 to review the revised five-year contract proposal, provide a tentative agreement and recommend passage by the workers locked out eight months ago.
The company didn't put an expiration date on the revised proposal, unlike its original offer, which expired after union members rejected it 998-768.
In related news, I didn't report this at the time, but (from the same article)
Butler County Sheriff Rick Jones publicly called for an end to the lockout, saying its ripples were creating more work for his department.
The number of sheriff's sales for homes and personal property is up 13 percent since the lockout began, compared with the same period last year.
In the article I read, he took out a half page ad in a local paper, more or less saying that AK Steel needed to act. He was criticized for appearing to take sides, but defended his actions by saying it was a lockout, so it was the companies turn to move.
As a result, Company May Not Sponsor Sheriff's Conference As In Previous Years
The ad was paid for by Jones' campaign fund. He is not up for re-election this year.
In another article I saw on the weekend, he said he's an elected official and always up for re-election.
Interestingly enough, the steel workers at AK have set up a web site and a bulletin board system to keep themselves informed (a great idea, by the way). In the early days, it was publicly viewable, and I read some interesting stuff about how they were concerned for the safety of the replacement workers, reviewing fragmentary information they were hearing about workplace safety, etc. Now, however, you have to be a member to join, and all the forums are closed, even to viewing, from the outside.
Somewhere in there is a link to my blog, because I see the hits in my server statistics, but when I go to see what's being said, I can't. Oh, well, can't comment on what I can't see.
At the same time, and in the back of everyone's mind in this situation, I'm sure, Analysts See Weaker Steel Prices in 4Q
Strength in commercial trucking, manufacturing and fabrication sectors have helped curb concerns in the industry over the slumping housing market and problems at the nation's largest automakers. However, analysts say steel service center inventories are on the rise and it may not be long before the mills -- where business has so far retained its strength -- will see a drop in orders.
Mittal Steel USA said last week it will idle two plants that make light flat-rolled products in order to bring production in line with reduced demand.
Thursday, October 05, 2006
Union workers strike against Goodyear
Depending on how long they strike, this could shut down the car plants too, which would trickle back to metal stampers.
Yahoo! News
Workers at 16 Goodyear Tire & Rubber Co. plants in 10 states and Canada went on strike Thursday after the world's third largest tire maker and the steelworkers union failed to agree on a new labor contract.
Just when you thought the price of driving couldn't get any higher.
Yahoo! News
Workers at 16 Goodyear Tire & Rubber Co. plants in 10 states and Canada went on strike Thursday after the world's third largest tire maker and the steelworkers union failed to agree on a new labor contract.
Just when you thought the price of driving couldn't get any higher.
Russia Sees Birth of Aluminum Giant
It looks like consolidation comes to the aluminum industry too. It will be called Rusal. It'll be bigger than Alcan.
businessweek.com
The deal was openly rumored for weeks, and now it appears to be real. On Oct. 4, according to leaks in the Russian media, Russia's two largest aluminum producers, Rusal and Sual, and Swiss commodities trader Glencore International, will team up in a merger to create the world's largest aluminum producer.
The impending merger will be worth almost $30 billion, with Rusal likely owning 64.5% of the combined company. Sual and Glencore will pick up 21.5% and 14%, respectively.
At the same time (I don't believe in coincidences)
Alcoa says it's in discussions with Quebec to expand and modernize plants
Multinational aluminum producer Alcoa says it is in discussion with the Quebec government regarding plans to expand or modernize plants in the province.
"Aluminum has so much potential and Quebec is pretty near the American market," Alcoa Canada president Jean-Pierre Gilardeau said after a speech Wednesday
"We just have to find a winning formula for both sides."
The talks have been going on for several months and are aimed at expanding or modernizing plants in outlying regions, Gilardeau said.
businessweek.com
The deal was openly rumored for weeks, and now it appears to be real. On Oct. 4, according to leaks in the Russian media, Russia's two largest aluminum producers, Rusal and Sual, and Swiss commodities trader Glencore International, will team up in a merger to create the world's largest aluminum producer.
The impending merger will be worth almost $30 billion, with Rusal likely owning 64.5% of the combined company. Sual and Glencore will pick up 21.5% and 14%, respectively.
At the same time (I don't believe in coincidences)
Alcoa says it's in discussions with Quebec to expand and modernize plants
Multinational aluminum producer Alcoa says it is in discussion with the Quebec government regarding plans to expand or modernize plants in the province.
"Aluminum has so much potential and Quebec is pretty near the American market," Alcoa Canada president Jean-Pierre Gilardeau said after a speech Wednesday
"We just have to find a winning formula for both sides."
The talks have been going on for several months and are aimed at expanding or modernizing plants in outlying regions, Gilardeau said.
Wednesday, October 04, 2006
Copper Drops to Three-Month Low on Concern U.S. Demand May Ease
Bloomberg.com
Copper in New York tumbled more than 4 percent to the lowest in three months on speculation a slowdown in the U.S. economy may reduce demand for industrial metals.
The price of copper is down 19 percent from a record $4.04 a pound in mid-May. U.S. manufacturing expanded less than analysts estimated in September and spending on home construction dropped for a fifth straight month in August, reports showed yesterday.
Copper in New York tumbled more than 4 percent to the lowest in three months on speculation a slowdown in the U.S. economy may reduce demand for industrial metals.
The price of copper is down 19 percent from a record $4.04 a pound in mid-May. U.S. manufacturing expanded less than analysts estimated in September and spending on home construction dropped for a fifth straight month in August, reports showed yesterday.
Labels: Copper
Lockout at AK Steel puts town on the outs
The third side of any strike ... the "collateral damage".
Pittsburgh Post-Gazette
The lockout at AK Steel's Middletown Works, which entered its eighth month Sunday, isn't just a battle between a company and its union workers.
The effects of the lockout, which already has resulted in the loss of hundreds of jobs, are spreading across the community, home to steelmaking for more than a century.
Small businesses are feeling the hurt, and the city government faces cutbacks in police and firefighters.
Pittsburgh Post-Gazette
The lockout at AK Steel's Middletown Works, which entered its eighth month Sunday, isn't just a battle between a company and its union workers.
The effects of the lockout, which already has resulted in the loss of hundreds of jobs, are spreading across the community, home to steelmaking for more than a century.
Small businesses are feeling the hurt, and the city government faces cutbacks in police and firefighters.
Monday, October 02, 2006
NICKEL PRICES DRIVING THE STAINLESS STEEL MARKET HIGHER
MEPS STEEL NEWS
Nickel prices at the time of writing, hovered around $US30,000 per tonne. This suggests that alloy surcharges on stainless steel will remain at their current unprecedented high levels for at least two months.
[...] Alloy surcharges have risen by more than 150 percent since January.
The LME price of nickel has doubled since March, and there is much controversy about the reasons for this. Users continue to claim that the nickel market is not under-supplied, and that the upsurge in prices is the result of speculation by financial investors. It is true that LME nickel stocks have been extremely low. And this tends to support the opinion of those who say there is a structural shortage.
The hike in nickel prices is increasing the supply of scrap onto the market. World trade in stainless scrap has risen by more than 1 million tonnes over the last four years. But so far this is not having a dampening effect on the price of nickel.
Nickel prices at the time of writing, hovered around $US30,000 per tonne. This suggests that alloy surcharges on stainless steel will remain at their current unprecedented high levels for at least two months.
[...] Alloy surcharges have risen by more than 150 percent since January.
The LME price of nickel has doubled since March, and there is much controversy about the reasons for this. Users continue to claim that the nickel market is not under-supplied, and that the upsurge in prices is the result of speculation by financial investors. It is true that LME nickel stocks have been extremely low. And this tends to support the opinion of those who say there is a structural shortage.
The hike in nickel prices is increasing the supply of scrap onto the market. World trade in stainless scrap has risen by more than 1 million tonnes over the last four years. But so far this is not having a dampening effect on the price of nickel.
Labels: nickel
