The latest MID-SHIP Report reiterates the crisis in the shipping industry calling it “the most significant depression in dry bulk shipping since the mid-1980’s.” The Baltic Dry Index, which tracks shipping rates for dry bulk cargos like iron ore, coal and grain, peaked in May 2008 with an index reading of 11,793 and fell to […]
We ended the month of January on a positive note. SMU Price Momentum Indicator continues to point toward higher prices over the next 30 days. Our Sentiment Index broke through an extended downward (growing pessimism) trend and is now heading higher (more optimistic). We believe a portion of the improvement is due to flat rolled […]
Cliffs Natural Resources narrowed its net loss to $58 million in fourth quarter compared to $1.4 billion in Q4 2014. Full year net loss was $748 million compared to $8.3 billion in the prior year. “Despite the severely negative impacts of global iron ore and domestic steel prices, in 2015 we achieved substantial cost reductions […]
On December 16th the Federal Reserve raised the federal funds rate for the first time in almost a decade and as we write the FOMC is meeting once again and will make another announcement tomorrow regarding any change to the rate. None is expected though it is anticipated that four hikes could occur in 2016. […]
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Essar Steel Algoma will begin the process of looking for a buyer or investor next month according to letters sent to suppliers by CEO Kalyan Ghosh. Under terms of the Debtor In Possession (DIP) Agreement, the company must get court approval for a “broad and investment solicitation process (SISP)” by February 1, 2016. “While we […]
The shipping season on the Great Lakes officially ended with the closing of the Soo Locks on Friday, Jan. 15. The locks in Sault St. Marie are the last to close for the winter season. The Welland Canal, through Ontario, closed on Dec 30 followed by the St. Lawrence Seaway locks on Dec. 31. The […]
On Tuesday, January 19, the Baltic Dry Index hit its lowest point ever, dropping to 363 points. The BDI tracks shipping rates for dry bulk cargos like iron ore, coal and grain and is considered a barometer for global steel trade. To put things in perspective, six months ago, on August 8, 2015, the Index […]
Often with steel related economic statistics it’s useful to compare a given data stream with others which may or may not be causally related. This usually puts the steel data into context and shows whether a direction change is for real. In this piece we are comparing the price of Chicago shredded scrap with the […]
US Steel Canada has received court approval to begin again the sales process for Hamilton and Lake Erie Works. US Steel Canada argued in a motion before the court: “With potential SISP bidders showing interest in USSC’s business and with important operational decisions for 2017 needing to be made beginning in the second half of […]
We are pleased to have Philip Hoffman, Chairman & CEO of Hoffman Iron & Steel provide us his unique insights on both the domestic and international scrap markets as well as his forecast for where international and domestic scrap prices will be headed in the next month or two (and why). As most are aware, […]
In the first eleven months of 2015 bulk scrap exports were 11,762,000 tonnes for an annual rate of 12,831,000 tonnes, down by 17.5 percent from the first eleven months of 2014. The tonnages shown in Figure 1 are based on three month moving averages (3MMA) for 2015 and on the annual monthly average for previous […]
The following article on the hot rolled coil (HRC), busheling scrap (BUS), and financial futures markets was written by Andre Marshall, CEO of Crunch Risk LLC and our Managing Price Risk I & II instructor. Assisting Andre with tonight’s article is Jack Marshall also associated with CrunchRisk. Here is how Andre and Jack saw trading […]
The following article is by contributing writer Damon Sun of Daido International. The Asian markets were anticipating the elimination of China’s export tax rebate, which has not happened yet. Likely, it will not happen. Anticipation of the elimination of China’s export tax rebate would have an impact of 9-13 percent increase in China’s exports of […]
An explanation of the Key Indicators concept is given at the end of this piece for those readers who are unfamiliar with it. The total number of indicators considered in this analysis is currently 36. We have made a change to our analysis this month by removing the capacity utilization of both the flat rolled […]
The flat rolled steel price roller coaster did not do the steel mills or companies holding inventory any favors this past year. We saw hot rolled prices drop from just below $650 per net ton (average) at the beginning of the year to the low point of $360 per ton achieved the week of December […]
Last year was a major year for labor contracts that affected the steel industry. After months of slowdowns and contentious negotiations on the West Coast in 2014, the PMA/ILWU finally ratified a contract in May of 2015. The labor dispute caused delay of steel shipments and other products, congestion on the docks, and shifted some […]
The China Iron and Steel Association reported that Chinese steel mills suffered losses of approximately $8.18 billion dollars in the first eleven months of 2015. Revenue fell 19.3 percent year over year for the 101 large and mid-sized steel mills that CISA tracks. With falling steel demand at home, China steel exports surged in the […]
Minnesota Gov. Mark Dayton gave Essar Steel Minnesota a week to agree to a terms of proposal to repay $66 million in loans. Essar received the loans in 2004 in return for promises to build a $1.9 billion iron ore processing plant and steel mill in Nashwauk, Minn. The taconite plant is still under construction […]
US Steel Corp announced it will postpone construction of the electric arc furnace at its Fairfield Works operation in Alabama due to “continued challenging market conditions in both the oil and gas and steel industries.” The $230 million EAF was scheduled for completion next year, giving US Steel the flexibility of its first EAF. The […]
Chinese steel trade data was recently released for the month of November 2015, providing updated data on iron ore imports, scrap imports, and flat rolled imports and exports. Chinese imports of iron ore in November were 82,130,000 metric tons, an increase of 8.8 percent from the previous month and an increase of 21.9 percent from […]
The USW and US Steel reached a tentative agreement late Saturday on a new contract for the more than 18,000 workers at US Steel’s flat-rolled, tubular and iron ore mining facilities in the United States. “This tentative agreement represents a major step forward from the position we found ourselves in earlier this summer when we […]
On Friday, SMU was speaking with the CEO of a Midwest-based service center who was advising us that, in his opinion, based on the conversations he was having with his mill suppliers, we should expect more flat rolled steel price increases to come. The mills were already asking his company for more and the mills’ […]
We will conduct our mid-December flat rolled steel market analysis (survey) beginning on Monday of this week. If you are on the invite list, please take a few moments to click on the link (button) and respond to our online questionnaire. If you were on the invite list in the past and for some reason […]
The following article on the hot rolled coil (HRC), busheling scrap (BUS), iron ore and financial futures markets was written by Andre Marshall, CEO of Crunch Risk LLC and our Managing Price Risk I & II instructor. Here is how Andre saw trading over the past week: Financial Markets: The stock market is taking a […]
In the first ten months of this year bulk scrap exports were 10,889,000 tonnes for an annual rate of 14,519,000 tonnes, down by 15.6 percent from the first ten months of last year. The tonnages shown in Figure 1 are based on three month moving averages (3MMA) for 2015 and on the annual monthly average […]
As the domestic mills announce price increases in the hopes of changing market momentum, one of the negatives is the spot price of iron ore in China (the largest seaborne ore buyer). Iron ore prices have been collapsing for the past two years with 62% Fe fines reaching $37.5/dmt today (TSI data). As you can […]
Navigation for freighters on the Great Lakes is winding to a close. This winter is expected to be warmer which may mean less ice on the Lakes and fewer delays of ore to mills when the shipping season reopens. The past two winters saw unusually high levels of ice coverage that persisted into April and […]
Essar Steel Minnesota met a deadline set by Governor Mark Dayton to repay $66 million in incentives owed the state after failing to complete a $1.9 billion integrated iron ore-to-steel mill. The governor gave Essar a deadline of Friday, December 4, to make payments to vendors on the project and provide assurances that future debts […]
The month of November saw a continuation of lower flat rolled steel prices, Momentum and Sentiment as buyers and sellers struggle to find a bottom to what has become an extended slide going back to May 2015. November benchmark hot rolled prices (SMU average) Dropped $15 per ton during the course of the month and […]