Cyclone shuts WA iron ore ports; oil, gas plants

by Reuters

A cyclone bearing down on Western Australia has brought iron ore shipments from the world's top exporter to a near standstill as ports shut ahead of the storm.

Two of the world's largest iron ore terminals at Port of Dampier and Port Hedland have suspended operations as Cyclone Carlos builds and sweeps toward the country's northwest.

Nearly all of Australia's around 400 million tonnes of iron ore exports are shipped from the two ports.

Port officials and meteorologists say it could be days before the storm passes and ships can return to the loading berths used by global mining giants such as Rio Tinto Ltd and BHP Billiton Ltd.

The centre of the cyclone is forecast to pass over Dampier around 1800 AEDT and continue to make its way south causing localised flooding.

Even a short interruption could add to a demand-driven rally toward $US200 a tonne on global iron markets. Iron ore prices have risen over 10 percent to date this year.

Gales with wind gusts to 110 kilometres per hour were slamming into coastal areas west of Port Hedland and were heading westward towards Dampier, according to the Australian Bureau of Meteorology.

Cyclones are a normal fixture of an Australian summer but the national weather bureau has indicated that above-average cyclone activity is to be expected this season due to a La Nina weather event.

"We've tied the port down and closed and all the vessels have gone to sea to get past the cyclone," chief executive of the Dampier Port Authority Steve Lewis said.

The Port of Dampier is one of two ports in Western Australia used by Rio Tinto to export around 200 million tonnes of iron ore each year.

"We're fully tied down at the coast, so there's no ship or rail movement until it passes," a Rio Tinto spokesman said.

Port Hedland suspended operations on Monday evening with the approach of Carlos, a category two storm, which is forecast to move westward in the coming days before turning southward.

A spokesperson for the Port Authority there told Reuters the harbour master would wait until the danger had passed and assess the situation before reopening the port to shipping.

BHP Billiton relies on Port Hedland to ship more than 100 million tonnes of iron ore a year. Fortescue Metals Group and Atlas Iron also use the port exclusively.

Australia's northwest coast is also home to some of the country's biggest oil and gas operations, with several of them suspending operations and battening down as the cyclone crosses through the area.

Woodside Petroleum Ltd halted production at its Cossack Pioneer floating, production, storage and offloading unit on the North West Shelf due to Tropical Cyclone Carlos the company said on Monday.

Apache Corp also halted production at its Stag and Van Gogh oil fields off the coast of Western Australia on Monday.

Chevron shut oil and gas production at Barrow and Thevenard Island facilities on Monday and non-essential workers were evacuated from the facilities.

"Production is being shut in and wells secured," Chevron spokesman Guy Houston said.

Commodities: crude, gas, coal up as Libyan chaos starts to impact on oil production

All prices unless otherwise stated are for the close of February 21.

2012 baseload German power: €53.34/MWh, up 1.91%
2012 CIF ARA Coal: €121.36/t, up 1.70%Front-month UK natural gas: GBp53.75/therm, up 2.87%
EU emission allowances (EUAs) for December 2011 delivery: €15.26/t, up 1.80%
Certified Emission Reduction(s) (CERs) for December 2011 delivery: €11.70/t, up 1.74%
Brent crude oil futures for front-month 2010 delivery: US$107.43/bbl, up 1.6%, as of 09:30 GMT, February 22
WTI crude oil futures for front-month 2010 delivery: US$97.64/bbl, up 2.4%, as of 09:30 GMT, February 22

Latest buzz

Oil prices have spiked again in response to the increasing volatile situation in Libya. The fact that the violence has prompted international oil companies to evacuate their staff and has forced one company to shut in 100,000bpd of output, equivalent to around 6% of Libya’s oil production appears to have really rattled the markets. The leader of the Al-Zuwayya tribe in the east of the country has threatened to cut off exports unless authorities cease the violence against protesters. Libya typically exports around 1.4mbpd of oil a day, with Germany, Italy and Spain being its biggest customers. Total global spare capacity is estimated at around 4.5mbpd, but it is unclear as to how much of this is in the form of heavy sour crude, in contrast to the high-quality oil produced by Libya.

In addition, tensions in the Middle East have been raised higher by the fact that two Iranian warships have entered the Suez Canal as part of their journey to the Mediterranean for training exercises. The news has attracted the ire of Israel, which sees the exercise as a provocation.

The IEA’s chief economist, Fatih Birol has said that “Oil prices are a serious risk for the global economic recovery,” and added that IEA member states would consider releasing oil from their emergency reserves should supplies be disrupted as a result of the situation in the Middle East. Meanwhile, Saudi Arabia’s deputy oil minister, Prince Abdulaziz bin Salman Al-Saud said that the market is currently abundantly supplied and therefore does not warrant intervention from other OPEC members.

The situation has had a knock-on effect on other energy commodities, with UK Natural gas for winter delivery rising 2.6% to GB62.15p/therm at 4:30pm on Monday, the highest price seen since December 30 and equivalent to US$10.09/mBtu. Gas for immediate delivery rose by 1.8% to GB53.7p/therm, which in turn helped to push up UK baseload power for next working day delivery by GBP1.15, to GBP46.75/MWh.

Gazprom has rejected a request from Germany’s E.ON Ruhrgas AG that Russian gas purchases be linked to the spot price. The current position in which long-term gas contracts between Gazprom and European customers are linked to the price of oil has come under strain of late, given the rising price of oil and the current abundance of natural gas on the international markets. In related news, Gazprom has said that it will pay Ukraine US$2.75bn in transit fees for shipping natural gas to Europe via its territory, up from the US$2.6bn paid in 2010. Anatoly Podmyshalsky also said that this year Ukraine will pay an average price of US$280/1000m³ of natural gas, rising to US$300/1000m³ in 2012. Russia is expecting to supply Ukraine with 40bnm³ of gas in 2011, up from the 38.7bnm³ delivered in 2010.

Persistent sea ice is still having an impact on Russian coal deliveries, with buyers in northern Europe being particularly affected, although the actual extent of the problem is currently unclear, particularly given subdued physical trading in Europe.

Chinese coal prices have fallen to a near four-month low of CNY770/t (US$117.1/t), due to a seasonal lull in demand, with many domestic buyers expecting the situation to persist until at least the end of March. The drop in prices occurred despite heavy fog in the Bohai Sea, which impacted on shipments for several days at the Qinghuangao and Tangshan ports, highlighting the raised levels of coal inventories at most power plants in the country, which are currently hovering around 20 days of coal burn. The situation has widened the gap between domestic and international coal prices and is expected to act as a break on imports. So far this week, prompt physical prices for South African cargoes have risen to US$119.25/t, while Newcastle thermal coal has risen by almost 8% to US$136.50/t. The increases are in response to the situation in Libya, given the lack of buying interest in Europe and Asia.

The Dec11 EUA contract rallied strongly on Monday, rising above €15.00/t in the first hour of trading. The events unfolding in Libya appear to have refocussed traders’ minds on the energy complex and this, combined with higher fuel prices and a corresponding increase in the value of the 2012 German baseload power contract provided the necessary impetus, to push Dec11 EUAs to a two-month high, finishing at €15.26/t.

CERs also performed strongly but were unable to keep up with the pace of EUAs. As a result, the Dec11 and Dec12 CER-EUA spreads widened to -€3.56 and -€4.30, respectively. Last week, just over 550,000 CERs were issued to two industrial gas destruction projects, a situation that should have added further support to CER prices.

Nickel futures down on overseas trend

Nickel futures prices moved down by 0.38 per cent to Rs 1,320 per kg in futures trading today after speculators reduced their positions, tracking weak trend at the London Metal Exchange (LME).

At the Multi Commodity Exchange, nickel for delivery in March contract shed Rs 5.10, or 0.38 per cent, to Rs 1,320 per kg, with a turnover of two lots.

Similarly, the metal for delivery in February weakened by Rs 4.90, or 0.37 per cent, to Rs 1,314.70 per kg, with a business turnover one lot.

Steel scrap prices decline on the German market

(23 February 2011) 

The strong increase in German ferrous scrap prices in January had all but melted away in the month of February, but prices still remained above December levels. In particular old steel scrap prices came under pressure, as export opportunities were few and far between. The question is now how developments in North African countries and Middle Eastern nations will affect steel deliveries and thus also Turkey’s demand for scrap.

EUROPEAN METAL RECYCLERS WELCOME TALKS ON SCRAP MARKETS

The European recycling groups EFR, an organization of ferrous scrap collectors, and EUROMETREC, a group of nonferrous recyclers, are welcoming the decision by the European Union to address the export of scrap metal. The two organizations responded to the EU’s Communication on Tackling the Challenges in Commodity Markets and on Raw Materials.

In applauding the report, the two organizations note that the identification of the 14 critical materials for the European Union’s industry was a vital task that also points out low recycling rates for many of those materials. 

Having made that identification, Francis Veys, executive director of EUROMETREC, observed that “Recyclers have always recycled what is profitable. Within the last two decades, legislation and funds have expanded recycling of materials. It is important that a robust economic and technological study is conducted into the potential for recycling of each of the critical metals, especially those that are used in very small quantities, for example in consumer goods in the EU, that are scrapped at their end-of-life.”

EFR and EUROMETREC welcome the recognition in the communication that “The need for legal clarity for defining when reprocessed waste can be classified as a product” is a major policy issue for resource efficiency and for improving conditions for recycling.

EFR and EUROMETREC support the full implementation and enforcement of European laws on the shipment of waste so that illegal shipments are at least minimized if not prevented. The two groups state that all the permitted or registered scrap companies legally carrying out their business do not want illegal activities undercutting their market and support that member states properly enforce the laws.

However also as EU taxpayers, recyclers point out that the measurement of both illegality and of enforcement success must be accurate in order to ensure proportionate application of national resources. Seeking innovative solutions should be widely supported, like EU-wide paperless electronic systems for waste shipments could prove both to reduce the administrative burden and costs on companies and to facilitate the identification of illegal shipments.

Ross Bartley, EFR’s environmental and technical officer, commends the EC’s intent to examine the feasibility of applying a global certification scheme for recycling facilities, building on environmentally sound management criteria, and reminded Ministers of their Recommendation at the OECD in 2004, and the agreements on similar environmentally sound management criteria of the UN-EP Basel Convention.

Overall, the communication’s initiatives forecast the EU-27 based recycling industries will expand under the sustainable and inclusive growth of the Europe 2020 Strategy.

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• By: Recycling Today Staff

The ferrous scrap spot market in the first 20 days of February

The ferrous scrap spot market in the first 20 days of February allowed buyers to pay a little bit less per ton for their scrap, but the price drop was only about a 4 percent. According to pricing survey data from the Raw Material Data Aggregation Service (RMDAS) that is compiled by Management Science Associates Inc. (MSA), Pittsburgh, national averages paid on the spot market for the most common scrap grades dropped from $17 to $21 in February. Click here to view February prices.

RMDAS Regional Spot Market Prices - February 2011
Commodity	Total US	North Central /	North Midwest	South
		East
Prompt Industrial Comp.	476	477	476	475
Shredded Scrap (#2)	451	454	451	446
# 1 Heavy Melting Steel	417	422	420	410
Aggregated weighted-average prices (USD) per gross ton delivered to consumers in each region,
rounded to whole integer

Although prices dropped across the board for prompt industrial grades, shredded scrap and No. 1 heavy melting steel (HMS), mills still paid more than $400 per ton for all grades across all regions.

No. 2 shredded scrap (shred with more than .17 copper content) maintained a national average price of $451 per ton on the spot market, continuing to fetch higher pricing than it did throughout the second half of 2010. The national average drop of $21 per ton marked just a 4.4 percent decrease from the $472 mills were paying the previous month.

Prices for the three grades covered in the RMDAS Index moved in fairly close sync across all three RMDAS regions (North Central/East; North Midwest; and South).

Pricing moved the least in the North Midwest region (consisting of Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, Wisconsin and the northwest corner of Indiana), where prompt grades lost only $14 in value and No. 2 shredded scrap just $17 in value.

Scrap recyclers speculate that many domestic electric arc furnace (EAF) mills had completed building up their winter inventories by the February buying period, making them less likely to make a spot purchase if the price was not to their liking.

Additionally, spot orders were unlikely to be placed from China or Taiwan in the first several days of February, as that nation’s factories and mills were largely shut down for the Lunar New Year holiday.

A scrap processor in the Upper Midwest says that as of late February, however, demand remains strong from mills and foundries in his region. “I’m having no problem selling steel scrap,” he comments.

Ongoing demand is being paired with obsolete scrap flows that have been slowed down because of weather obstacles in much of the United States in February. A scrap processor in Missouri says that, except for one three- or four-day thaw, most of February has provided difficult conditions for the peddlers who collect and haul scrap in rural counties.

The domestic steel industry appears to be serving customers who are more eager for their products with each passing month. The American Iron and Steel Institute (AISI) reported that in December 2010 steel mills in the United States shipped 7.1 million net tons of finished steel.

The figure marks an 8.6 percent increase from the 6.5 million net tons shipped the month before and a 17.8 percent increase from the 6.0 million tons shipped in December of 2009.

For the entire year 2010, the 83.4 million tons shipped by the domestic steel industry represented a 38.3 percent increase from the 2009 shipments of 60.3 million tons.

The Raw Material Data Aggregation Service (RMDAS) Ferrous Scrap Price Index is based on data gathered from a statistically significant compilation of verified ferrous scrap purchase transactions.

RMDAS is a service of Management Science Associates Inc. (MSA), Pittsburgh. Those seeking more information about RMDAS can contact MSA’s Jeralyn Brown at 724-265-6574 or via e-mail at JBrown@MSA.com. 

 

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• By: Recycling Today Staff

the China Iron & Steel Association (CISA), price manipulation worsened in the iron ore market

According to the latest research by the China Iron & Steel Association (CISA), price manipulation worsened in the iron ore market, it was revealed at an internal meeting on Tuesday.

CISA suggests the nation adopt iron ore reserves as a national strategy to help balance the development of the industry, Beijing Times reported Wednesday.

CISA said that currently, China is the largest iron ore importer, taking 75 percent of the world's total iron ore seaborne trade. As the three giants - Rio Tinto, BHP Billiton and Vale – dominated the market, they have been pushing the iron ore prices up for years. Chinese steel enterprises suffered from the price hike as their profit margin kept decreasing, the report said.

Wu Xinchun, deputy secretary-general of CISA, said price manipulation is a given in the industry. China's iron ore imports have continued to increase since last September, but its domestic output of pig iron stayed at a low point.

Meanwhile, China's crude steel production was pushed up in the international market and the iron ore price has been pushed up since the end of last year. Now the iron ore spot price has hit a historic high of $200 per ton and its index price has reached approximately $180 per ton, he said.

Wu said that as a national strategic resource, it is necessary to have iron ore reserves established by law and written into policy. He suggests the country establish a special agency to manage iron ore reserves.

Hammadde & Hurda

Ham madde & Hurda
- Tokyo Steel hurda alım fiyatlarını yeniden artırdı
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- Hindistan pik demir ihalesindeki teklif fiyatları geriledi
- DTÖ hammadde ihracat davasında Çin'i haksız buluyor
- London Mining'in Greenland cevher madeni için geri sayım
- Rusya hurda ihracatlarını kısıtlarsa toplanan hurda miktarı azalabilir
- Sims: Brisbane hurda kıyım tesisi Şubat sonunda üretime dönecek
- AB'li tesisler aylık ham madde anlaşmalarına karşı çıkıyor

Chinese buyers expecting lower iron ore prices

CHINESE mills and traders, as well as Australian miners, expect iron ore prices to fall by at least 10 per cent later in the year as the world's biggest steelmaking nation steps up the overhaul of the sector as part of the country's new Five Year Plan.

China's largest steelmaker, Baosteel, lifted its prices this week for the third month in a row even as it continued its acquisition and expansion binge, but authorities signalled that overall output growth in the sector was planned to slow this year.

Another top-five Chinese steelmaker, Wuhan Steel, and Japan Nippon Steel have also increased their prices in recent days.

Spot prices for high-grade Indian ore hit $200 per tonne this week and have already risen more than 12 per cent this year, after jumping over 40 per cent last year.

The higher prices will feed into the next quarterly contracts, which use a weighted average from the previous quarter.

As well as higher iron ore prices, steelmakers have faced higher coking coal costs because of flooding in Queensland.

Ironically, higher steel prices will feed into Australian inflation as we buy back finished steel products from China, Japan and South Korea.

But traders and mill staff predict that while high iron ore prices will continue for several months, they will fall back in the second half of the year.

One mining executive predicts they will fall by about 10 per cent, a similar prediction to that made by a Chinese steel company executive.

A recent report from China's Shanxi Securities says consolidation in the Chinese sector -- in part designed to combat the oligopoly power of the three mining majors, Vale, Rio Tinto and BHP Billiton -- accelerated in late 2010.

It says this will be the main theme for the sector in 2011, with Baosteel, Hebei Steel Group, Ansteel and other major steel groups all expanding by buying private mills and smaller government-run operations as well as developing more modern and cleaner production capacity.

The report says the steel sector plan for China's 12th Five Year Plan -- which runs from 2011 to 2015 -- is being finalised and that several huge steel groups will be formed, a long-held aim of the Chinese government.

As well as a "structural optimisation" aimed at strengthening China's negotiating position for raw materials, the plan is believed to target lower energy costs and lower emissions.

Last month, the Hebei Steel Group acquired a share of seven private steel companies in Hebei province, the biggest steelmaking region in China.

Shandong Steel is trying to consolidate the industry in one of China's most populous provinces and Fortescue Metal shareholder Hunan Valin is keen to list on the stockmarket.

Baosteel is creating a new steel venture in the southern industrial province of Guangdong after buying Guangzhou Steel and Shao Steel.

The government is trying to strip capacity from higher emitting and polluting mills.

Spot iron ore softens to $196-198 cfr

21 February 2011

Spot iron ore prices dropped for the first time since late-October, as buyers showed little interest in prices at near-record levels. 

Firm prices were heard at $196-198 per tonne cfr China, down $1 from last Friday, with most offers receding below $200 per tonne. 

“There is very little buying now, even at $197 per tonne,” said a trader in Hong Kong. “People think that iron ore prices will make a correction following the steel price, although today’s steel market seems better than last Friday.” 

Steel prices rebounded today, with the benchmark rebar price on the Shanghai Futures Exchange rising to 5,026 yuan ($765) per tonne, up 41 yuan from Friday. 

“The rebound could be temporary, and the clearer trend remains wait-and-see,” said a steel analyst in Shanghai. 

While iron ore prices are looking downwards, most market participants are reluctant to predict any sudden softening of the market. 

“Prices can hardly fall below $190. Demand is normally stronger after the lantern festival [on Feb 17], and it’s just a matter of time until steel mills 
regain their confidence,” said a trader in Shandong. 

A tender was closed at $68 fob for 50% Indian fines at the end of last week, industry sources told MB. 

Rio Tinto’s iron ore exports from the Pilbara will be disrupted by cyclones brushing the coast of Western Australia, the company said. Shipments in the first quarter were likely to be hit as the wet weather hit port operations.

BHP monthly coking offer meets Asian resistance

22 February 2011

A move by BHP Billiton-Mitsubishi Alliance (BMA) to shorten its coking coal pricing from quarterly to monthly has come up against stiff resistance from its Asian mill customers.

These include Japan's JFE Steel and Sumitomo Metal Industries (SMI), and South Korea's Posco, sources told MB.

"BHP has just offered to shift from quarterly coking coal prices to monthly prices in April 2011. Without going into details, but we are strongly against the idea," said a source at (SMI).

It is simply not workable to move to monthly pricing after having shortened to quarterly pricing just one year ago; it would be impossible for mills to plan production or price its products, he said.

"Our downstream customers have not all accepted quarterly prices for steel products, let alone monthly ones now," he added.

Posco has not received an official monthly offer from BMA, but also opposed shorter pricing terms, said a company source.

"We believe that mills will definitely fight against monthly prices, and coking coal suppliers should not shorten pricing terms regardless of its long-term customers' resentment," she said.

A JFE Steel spokesman would not confirm if it had received BMA's monthly offer, but said it was against "any shorter term contract, including quarterly ones".

2010 saw long-term iron ore and coking coal contracts moved from the long-standing annual pricing scheme to a quarterly one.

Nippon Steel declined to comment and JFE Steel could not be reached. Kobe Steel said it had not received a monthly pricing offer from BMA and declined further comment.

The SMI source does not believe that BMA will succeed in introducing monthly pricing. 

BMA was part of a bigger move from annual to quarterly pricing last year, but this time, it was the only one pushing for monthly prices, he noted.

"BMA stands alone this year," he said.

However, coking coal contracts were moving inexorably towards shorter pricing terms, even if the change did not happen for April, said an analyst in Shanghai.

BMA concluded March quarter contract prices for hard coking coal to Japan at $225 per tonne fob Australia, up 7.7% from the previous quarter.

BHP, an early advocate of shorter pricing in general, has been selling most of its iron ore to long-term customers in China on pricing periods of one month or less.

Ferro-chrome rises as market debates quarterly outlook

21 February 2011

High-carbon ferro-chrome prices rose five cents on Friday amid strong demand and as market participants continued to debate the prospects for a higher benchmark price for charge chrome in the second quarter. 

Material traded at $1.30-1.40 per tonne, compared with $1.25-1.35 per tonne on February 11 when prices gained five cents after holding since November 5. 
Deals representing several hundred tonnes of business were reported to MB all the way across the trading range. 

Rising spot prices in the first quarter have led producer hopes for a double digit hike in the quarterly benchmark, with some predicting an increase to as much as $1.50 per tonne, compared with the last settlement of $1.25 per tonne. 

South African producers need a increase in order to justify their cost of production, as they contend with rising power and raw material costs and competition from China, some sources warned. 

“If the Europeans don’t accept it, the largest South African producers will just stop and that will be playing straight into the hands of the Chinese,” a market participant told MB. 

The first quarter settlement fell five cents from the fourth quarter of 2010 despite hopes for a rollover. 

Stainless steel makers had initially said they appreciated the South African ferro-chrome producers’ position, but an influx of cheap South African material into China undermined calls for a rise. 

Those sales have now come to an end, further bolstering producer hopes, sources told MB. 

But while a double digit rise is a reasonable expectation, an increase to $1.50 per tonne is far from guaranteed, according to one analyst. 

“I’d be very surprised if we don’t see a rise, possibly a double digit rise, but to be asking for a 25 cent rise is very aggressive,” the analyst told MB. 

“It’s the sort of number you might imagine the producers pitching as an opening number to negotiations. For the next quarterly, it’s going to be more about the units needed for stainless steel, and I think that balance will be tighter,” the analyst added. 

South African consultancy and research firm Core Consultants expects the benchmark price to rise steadily to $1.33 per tonne by the fourth quarter and expects the market to remain in balance throughout 2011, md Lara Smith told delegates at the 2011 Investing in African Mining Indaba in Cape Town on February 10. 

Smith estimates average South African production costs at 89-92 cents per lb, she said. 

Meanwhile, Turkish producer Eti Krom is forecasting ferro-chrome consumption of 9.5 million tonnes for 2011 and expects Chinese stainless steel production to reach 35 million tonnes, the company said on Friday. 

“The benchmark will be adjusted to the spot market price levels following traditional settlement paths seen in the past. If the settlement would be reached today [Feb 18th] it would need to be aleady a double digit increase,” president and ceo Robert Yildirim said. 

Xstrata Alloys saw an increase of $458 million in operating profit in 2010 thanks to a 46% rise in the average ferro-chrome benchmark, as production rose to 1.17 million tonnes from 786,000 tonnes in 2009, the company announced earlier this month. 

Xstrata Alloys has employed a range of measures aimed at reducing its production costs, including the introduction of its proprietary Premus technology, the lowest power consumption of all ferro-chrome smelting technologies. 

It is also investigating the feasibility of using electricity generated by its own power station.

Merchants boost Fe scrap offers to Spanish mills

21 February 2011

Ferrous scrap merchants have increased offers to Spanish mills, despite fears that rebar exports may suffer due to political disturbances in North Africa. 

Depending on the trader, grades were on offer at €5-20 ($6-27) per tonne more than last week’s transactions. 

Shredded material in containers stood at €330-335 per tonne cfr northern Spain, up from a transacted price of €325 per tonne cfr last week. 

HMS 1&2 was available for €310-315 per tonne cfr, up €5 from a booking of ex-UK material made at the end of last week. 

There was also demand for OA scrap at €330-335 per tonne cfr, while new cuttings were offered at €355-360 per tonne cfr. 

A domestic scrap merchant increased prices by €20 per tonne delivered for every grade this week, supported by stronger demand. 

Meanwhile, a UK-based scrap processor received an offer for containerised shredded scrap at £265 ($430) per tonne ex-yard, after rejecting offers of €5 per tonne more at the end of last week. 

“I believe the market was over-corrected and mills will need to increase [offer] prices to secure volumes,” the scrap processor said. 

Some Spanish merchants are increasingly cautious as political instability affects export markets in North Africa. 

“There’s no need to push prices up too much, even though some agents are asking for more and more,” a Spanish merchant said. 

“There is more [finished product] demand than [I’d] expect in this situation though,” the merchant said.

DAILY SCRAP REPORT: Turkish mills book en masse, prices rise tentatively

21 February 2011

MB’s Daily Ferrous Scrap Index cfr Iskenderun rose on Monday following heavy booking activity by Turkish mills at the end of last week. 

Increasing $1.83 per tonne to $446.26 on Monday from Friday’s figure of $444.43 per tonne, transaction prices failed to match the increases expected by recyclers and mills at the end of last week. 

Turkish steelmakers believed US scrap processors would return to the market near $460 per tonne cfr, but cargoes were booked up to $15 below that level. 

One international scrap processing firm sold at least three cargoes to separate Turkish mini-mills from the USA. 

The first cargo was sold at $445 per tonne cfr for HMS 1&2 (80:20), $450 per tonne cfr for shredded material and bonus grade was booked at $455 per tonne cfr Iskenderun. 

Two more cargoes were booked by two Turkish mini-mills and contain HMS 1&2 (80:20) at $446 and $448 per tonne cfr, shredded material bought at $451 and $453 per tonne cfr, while bonus scrap was booked at $456 and $458 per tonne cfr. 

Rumours of a fourth sale from the USA were unconfirmed at the time of writing. 

An EU-based recycler was also involved in the booking frenzy, selling 35,000 tonnes of HMS 1&2 (70:30) grade to a Turkish mill, which also booked the first cargo from the USA scrap processor. 

The same steelmaker also bought a break bulk cargo from a UK recycler. 

The mill purchased HMS 1&2 (80:20) at $441 per tonne cfr, shredded material at $447 per tonne cfr, and bonus grade at $452 per tonne cfr. 

A fourth Turkish steelmaker entered the market buying 24,000 tonnes of HMS 1&2 (80:20) at $448 per tonne cfr and 17,000 tonnes of shredded scrap at $453 per tonne cfr. 

Although transaction levels were not as high as expected, recyclers were glad to see the end of the recent price falls. 

“It seems the downtrend has stopped and these prices represent some recovery to previous levels and expectations,” a recycler said. 

“Further recovery depends on whether more transactions are needed by the Turkish mills this week,” the recycler continued. 

Iron ore: China - January 2011

According to Chinese sources of information / in particular, the Ministry of Resources PRC, probable reserves of iron ore in China range from 100 to 200 billion tons Probable reserves / resources of minerals, which may be assessed on the basis of geological background and theoretical considerations, having regard to the deposit / ore, according to the Institute of mineral resources of the Academy of Geology, China, evaluated at the end 2008to 62.4 billion tons, but more than half of these reserves are deposits with low iron content. According to the USGS / USA / proved reserves / fully proven reserves, ready for working out / iron ore in China in the late 2010were 23 billion tons or 7.2 billion tons in terms of content of Fe. In 2010China has produced 1,071,555,000 tons of crude iron ore / in terms of iron ore with 64-66 percent Fe - about 550 million tonnes or 21.6 percent more than in 2009. Increased production of iron ore in China 2010the first time in recent years affected the volume of imports of iron ore. In2010imports of iron ore decreased in comparison with 2009and amounted to 618.5 million tons proportion of Australia, Brazil, and India's total imports of iron ore in China fell in the2010to 79.7 percent / 81.5 percent in 2009. Been an increase in supply from Iran, Indonesia, Ukraine and Venezuela. Supplies from Iran amounted to 14.5 million tons a result, Iran has introduced a 50-percent export duty on export of all types of iron ore products: iron ore, ore fines, lump ore and pellets /, starting from January 192010. In January 2011reserves of iron ore in the 23 major ports in China reached a record in recent years figure of 77 million tons In January 2011Prices for imported iron ore and iron ore concentrate from China continued to grow.Thus, the average price of iron ore concentrate / 65-percent Fe, imports from Brazil in the port of Qingdao in eastern China in January2011amounted to 206-208 dollars per ton, including taxes. Average prices for iron ore / 65-percent Fe / Chinese production in the province of Liaoning / northeast China 'in January2011were within 183,6-185,2 USD / t, EXW, VAT included. It is expected that iron ore prices in China continue to rise, at least until April2011. Review of the prepared HA Petropavlovsk.

Source: Itar-Tass

Russia; Ferrous metal market in February

Trading house CMI is pleased to review the Russian market of ferrous metal in January, as well as forecasts of the situation in February.

In the domestic market, reinforcing bar Russia has seen an excessive increase in stock prices caused by the fact that Russian producers have raised prices in February to 2,500 rubles. / T including VAT. So fitting A500C D12mm invited from warehouses in Moscow already 27,000 rubles / t including VAT.

According to specialists of the marketing department of Trade House CMI spot market necessity, but adopts the increase. Surplus stocks rolled traders are not observed, warehouse prices continue to grow actively, and traders are ready to place orders with manufacturers.

On the spot market structural shapes as higher prices, the corners of 50-63 already sold at 26,700 rubles / ton VAT from a warehouse in Moscow. However, unlike the valve (where the potential growth of prices from producers to expire) on the market structural shapes, this trend may still continue. Therefore, we need to be ready for the new increases in stock prices on the corners and channels.

In the international market of flat rolled steelmakers, within two months raised the price of hot-rolled coils by more than 40%, took a pause. Following the foreign economic situation Russian producers of flat rolled steel prices increased in February. Thus, plants NLMK and Severstal have raised prices for hot-rolled sheet by 15-16% and cold - by 10-13% (including the abolition of hidden commercial discounts). CMI has raised prices for hot-rolled sheet with thickness of 16 mm by 14%, thickness exceeding 16 mm by 5% on cold-rolled sheet by 10% on galvanized steel by 8% and rental coated by 7%.

These actions of Metal replied the rapid growth of storage quotes that have already surpassed the February purchase prices and continue to rise. Since lists art. 3 of a thickness 6-12 mm. now sold at 26000-26300 rubles / ton in Moscow with the VAT. In addition, there is a high activity of traders in the placing of orders from manufacturers in February, indicating that traders' expectations of future growth ex-works prices.

The market profile industry began a noticeable intensification and rising prices caused by the rise in price of rolled. Despite the low seasonal activity, traders are forced to raise their quotes, which causes intensification of demand, as consumers try to have time to replenish their stocks at old prices.

Press Center TD CMI