Page 56 from: March 2016
56 March 2016
M A R K E T A N A L Y S I S Ferrous
emerging as the only major steel pro-
ducers to post increases.
The world’s largest steelmaker China
suffered one of its sharpest production
cutbacks, estimated at 7.8% to 63.214
million tonnes, while EU production slid
7.6% to 13.428 million tonnes and US
output dropped 8.8% to 6.618 million
tonnes. Again compared to January
2015, smaller production declines were
registered by Japan (-2.8% to 8.772
million tonnes) and India (-1.2% to
7.418 million tonnes).
In other regions of the world, crude
steel output in South America tumbled
14.6% year on year to 3.251 million
tonnes in January while the decline
was even steeper in Africa (-14.9% to
1.142 million tonnes). Making the same
comparison, production fell 11.3% in
the Middle East and 6.3% in Oceania,
according to the WSA.
Figures already available for early Feb-
ruary are more encouraging. Capacity
utilisation in the USA climbed to 72.7%
in the week ending February 20 while
average output by leading Chinese pro-
ducers was almost 4% higher in the first
10 days of February than in the final 11
days of the previous month.
Outlook
Billet prices have recorded increases
and iron ore values have responded in
kind, with the latter gaining more than
25% in recent trading from an admit-
tedly very low level. Will scrap follow
suit? With overcapacity and other fun-
damental issues continuing to weigh
heavily on the scrap industry and its
leading customers, the consensus is that
the scope remains limited for significant
upward price movement in the short
term.
Ferrous Scrap Prices Reference date: February 12, 2016
–
–
Crude steel production: 2015 in brief
World crude steel production totalled 1.623 billion tonnes in 2015, down
2.8% from the 1.67 billion tonnes of 2014. An increase in output was
recorded by only one country among the leading 10 steel producers by
volume – namely India, with a 2.6% gain to 89.6 million tonnes – while
steel production fell in all regions of the world with the exception of Ocea-
nia where there was an upturn of 4.6% to 5.7 million tonnes, according
to the World Steel Association. Production across Asia fell by 2.3% to
1.114 billion tonnes, the decline for Europe was 3.2% to 303.9 million
tonnes and North America saw a drop of 8.6% to 110.7 million tonnes.
Lower outputs were also reported by South America (-2.5% to 43.9 million
tonnes), the Middle East (-0.5% to 29.8 million tonnes) and Africa (-0.2%
to 15 million tonnes).
USA Domestic Scrap Prices (US$/GRT)
HMS 1 heavy steel scrap (1/4 Inch) composite price delivered at mills
USA Export Prices (US$/GRT)
HMS 1, heavy steel scrap (1/4 Inch)
CFR Prices for shipments
from EU to Turkey (US$/t)
HMS 80/20 heavy steel scrap
235
235 240 240
255 250
350
300
250
200
150
F M A M J J A S O N D J F
F M A M J J A S O N D J F
F M A M J J A S O N D J F
F M A M J J A S O N D J F
350
300
250
200
150
208
207
222 224
172184
138172
183
219
211
232
265
250
220220
186
170 175 167180
160 170 170
210 210
230 230
234
209
165 170
190
195
190
220225
265
275
265
255
240
195
185
175
185
—– Highest price
—– Lowest price
—– Fob East Coast price
—– Fob West Coast price
190
185
215
220
255
270
260
250
235
190
180
170
180
220
185
145
155
152
160
170
400
350
300
250
200
400
350
300
250
200
Composite Sales Price ex Yard in Germany * (€/t)
E3/European Standard Quality No. 3, heavy old steel scrap ( >6mm )
* Composite sales price considers sales to domestic and international steel works and foundries on weighted average basis
Source: BDSV/SecureCalc
149
146
135138
203
225
