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Market Dynamics

Recession Fears, Waning Confidence Make For Uneasy Summer In US Metal Market

Summertime is supposed to be when the living is easy. At least that's how the old song goes.

However, with recession concerns swirling, consumer confidence waning and demand softening, this summer has been anything but easy on the US metal market.

At the same time, prices for a number of headline products – from hot-rolled steel to primary aluminum, ferrous scrap to pig iron – have been in a steady decline following a rapid runup in the early part of the year.

The upturn came just after domestic metals markets appeared to be stabilizing from record price highs in 2021. And the current downturn is yet another example of the continuing challenges of an uneven post-COVID economic recovery.

U.S. Hot-Rolled Coil Down 40% Since April

Deteriorating Prices, Inflation a 'Double Whammy' for North American Steel Market: Stelco CEO

Deteriorating pricing and demand coupled with inflationary pressure on input costs is a "double whammy" for North American flat-rolled steelmakers, making this downturn different from previous troughs, Stelco CEO Alan Kestenbaum said Aug. 11.

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Cliffs Expects Automotive Steel Demand Rebound By Year-End: CEO

Cleveland-Cliffs anticipates steel demand from the automotive industry to improve by the end of the year, rebounding from floundering steel consumption in automotive industry since 2020 due to lower vehicle production, CEO Lourenco Goncalves said July 22.

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Flat Products Steelmaker HBIS Serbia To Halt One Of Two Blast Furnaces In Unfavorable Market

Belgrade-based steel mill HBIS Serbia announced July 11 that unfavorable conditions in the global steel market have prompted the company to shut down one of its two blast furnaces.

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Green Steel

Boston Metal Blazing Path For 'Green' Steel Without Scrap, DRI: CEO

Boston Metal has plans to produce steel with low carbon emissions that could fully drive a decarbonized steel industry unlike current "greener" methods, CEO Tadeu Carneiro says.

Liberty Steel Ostrava To Install Hybrid EAFs In Czech Republic In Green Steel Push

Liberty Steel Group, part of the GFG Alliance grouping, said July 8 that it has signed a contract with global plant manufacturer Danieli for delivery of two hybrid electric arc furnaces (EAFs) to the integrated Liberty Ostrava steel mill in the Czech Republic as part of the mill's green steel drive.

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The Platts Market Data - Metals dataset provides over 2,400 ferrous steel, steel raw materials, and nonferrous metals prices and indicators from all global regions. With this dataset you have access to end-of-day assessments, correlations and third-party data for the latest ferrous and nonferrous price assessments as well as historical data.

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China

Why China’s Economic Measures May Not Be Enough To Drive Up Consumer Demand

China's economic activity has started to recover from the late-May COVID-19 resurgence, while the government has also been stepping up fiscal and monetary stimuli to support the recovery. However, recovery this year is likely to face a bumpy ride and remain relatively weak compared to the waves in 2020 and 2021, with the spread of the omicron variant proving more difficult to contain.

The slowdown in property sector will only further compound China's economic challenges. Expectations for any steel demand growth for the remainder of 2022 may need to be tempered.

The omicron resurgence lasts longer

China took less than two months to contain the COVID-19 outbreak in 2020 and the delta variant resurgence in 2021. But due to the highly contagious nature of the omicron variant, it took China nearly three months – from early March to early June – to control the coronavirus outbreak in 2022. And this came with a price.

China employs a dynamic zero-COVID policy toward the pandemic, which means certain social restrictions and lockdowns will be repetitively implemented in the foreseeable future to contain new waves of the virus, keeping the rate of economic and steel demand recovery slow.

China’s COVID-19 Cases

China's Construction Steel Demand Likely to Remain Low for Rest of 2022

China's domestic demand for construction steel is likely to remain low for the rest of 2022, market participants told S&P Global Commodity Insights, with the key indicator of excavator sales declining for the fourth straight month in July.

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China Steel Trade To Fall In Coming Months As Weak Demand Outlook Weighs

China's semi-finished steel exports retreated 3.1% on the month to 278,000 mt in June, falling for the first time in three months, the country's customs data showed July 21.

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China's Steel Output Cuts Widen In Mid-July; Price Rise Seen Limited

China's pig iron and crude steel output are likely to decline further in mid- and late-July, as more steel mills have been forced to cut output amid increasing losses.

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Trade Review: Turnaround In Asian Scrap Market In Q3 Hinges On China's Steel Demand

Asian seaborne scrap prices are expected to remain under downward pressure in the third quarter after retreating through Q2 from the multi-year highs reached in the wake of Russia's invasion of Ukraine in late February.

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The SNL Metals and Mining dataset allows you to explore the in-depth coverage on mining properties and companies, covering a wide array of commodities. Keep track of ongoing sector activities including initial exploration, project developments and commodity production.

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Global Trade

H1 Brazil Steel Exports to Europe Skyrocket 710% on Year Amid War in Ukraine

Exports of Brazilian steel products to Europe jumped 710% in the first half of 2022 to 909,828 mt, compared to 112,221 mt in H1 2021, filling the void left by regional suppliers Russia and Ukraine, according to latest data from national steel association Aço Brasil.

The export volume to Europe represented 13.4% of total Brazilian exports in January-June, compared to 2.2% in the same period of 2021, and was mainly composed of coated and uncoated flat steel products.

The supply restrictions derived from the Russia-Ukraine war also prompted Brazil to increase shipments to neighboring countries in Latin America, totaling at 2.12 million mt in H2, up 66.7% on the year. Shipments to Asia followed, totaling 174,663 mt, up 3.1% on the year, and shipments to Africa totaled 128,101 mt, up 594% on the year.

Brazilian Exports of Steel Products by Region, Jan-June

German Steel Market Sees Output Staying Low, Higher Prices: survey

German steel producers and traders expect prices to see some upward momentum over August amid low supply, as production levels are expected to drop, according to data from S&P Global Commodity Insights' monthly steel sentiment survey.

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U.S. Steel Targets 40% In-Sourcing of Steelmaking Metallics by 2024

U.S. Steel plans to internally source up to 40% of its iron-based metallics for steelmaking by 2024, up from the current 10% of internal sourcing, with an emphasis on pig iron over direct-reduced iron, CEO David Burritt said July 29.

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ArcelorMittal Expects Europe's Real Steel Demand to be 'At Least Stable' This Year: CFO

ArcelorMittal expects real steel demand this year in Europe to be "at least stable if not slightly positive," despite current headwinds, the major steelmaker's CFO said on a conference call.

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The Trucost Metals and Mining Climate Competitiveness dataset assesses the carbon pricing risk, water stress risk and future commodity market alignment of the metals and mining industry at an asset- and company-level.

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Ask an Expert

Have Metal Prices Reached A Melting Point?

Join our metals experts, John Anton and John Mothersole, as they delve into the volatility of metals pricing in the wake of the Russian invasion of Ukraine and with the growing COVID-19 outbreak in China.

These two factors are placing immense stress on steel, copper, and aluminum markets. And while we usually hear a singular global story—this month, regions are telling their own metals pricing tales. What does this mean for buyers, manufacturers, and consumers? How high is too high?

John Anton is the lead steel expert, as a director in the Pricing and Purchasing Service at S&P Global Market Intelligence.

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