Page 49 from: January / February 2008
capacity). This very large ore carrier
(VLOC) will be 460 metres long and
65 metres wide. There exists a big-
ger tanker of 565 000 tonnes dwt,
but this is used for storage only.
Steel
Western World steel prices are on
the increase once again owing to:
somewhat better demand for long
steel – especially in CIS countries
and the Middle East – as a result of
rising commodity prices; and antici-
pation of lower Chinese steel exports.
China exported a record 62 million
tonnes in 2007, but the total is ex-
pected to fall 20 million tonnes this
year to around the 2006 level of 43
million tonnes.
China has introduced export tax
increases of 5 to 15% for cold rolled
coils and 10-15% for hot rolled coils,
as well as a new 15% export tax on
long products. Chinese officials are
euphemistically calling these in-
creases ‘tax adjustments’ but, no
matter what name they use, Chinese
export prices for rebar have now sur-
passed the US$ 700 per tonne level.
Confident that Chinese exporters
will be less able to compete in their
markets following the introduction
of this export tax on long products,
Turkish steel producers have
thought it safe to implement two fob
price increases in January. Turkey
is also exporting again to South East
Asia after a period in which their
overseas focus was mainly on
Mediterranean and Gulf countries.
Rebar and debar prices remained
stable in Europe and the USA dur-
ing December but are now rising
rapidly as Turkey’s export prices
have jumped some US$ 75 per tonne
in January. European mills have al-
ready raised first-quarter prices by
Euro 30 (US$ 45) per tonne, but this
could prove insufficient in view of
the present steel boom. In the USA,
flat product manufacturers are ask-
ing for an increase of US$ 30 per
tonne for January shipments and for
a further US$ 40 for February deliv-
eries. In addition, US mills have
leaked their intention to ask for an-
other increase of US$ 40-50 per
tonne for March deliveries.
Conclusion
The scrap market is undoubtedly
very firm at this moment, nearing
the level of US$ 500 per tonne cfr or
cif/c&f. But it may have risen too far
and too quickly, thus enabling HBI/
DRI and pig iron suppliers to switch
mini-mill buyers away from scrap by
offering comparatively cheap prices.
Delivered scrap prices are often the
same as fob prices for pig iron – for in-
stance, for deliveries from Brazil to
New Orleans. And in recent quarters,
fob DRI/HBI prices have been similar
to fob scrap prices. But now that scrap
prices have risen more than 25% in
the space of a month, manufacturers
of these competing commodities could
take the chance to push scrap out of
the market, or at least force scrap
merchants to lower their prices in the
second quarter.
In conclusion, it is felt that the
scrap trade will be unable to main-
tain the high price levels evident in
the first or into the second quarter.
However, further freight rate in-
creases and US dollar/Euro move-
ments may change the scenario.
M A R K E T A N A L Y S I S
SGM Magnetics Metal recovery line for fines Auto Shredder Residue
Europe
Refer to website for
your local SGM subsidiary
www.sgm-magnetics.com
USA
SGM Magnetics Corp.
Phone +1 941.342.8800
[email protected]
New references every month
Looks little, but makes a heavy weight
difference at the end of the month!
3-5% NF-Metals Fines
Waste Fines
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