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Latest metals news09/08/24UK TRA proposes 2.9mn t HRC import quotaUK TRA proposes 2.9mn t HRC import quotaLondon, 9 August (Argus) — The UK Trade Remedies Authority (TRA) has recommendedsplitting the country's safeguard import quota for hot-rolled coil (HRC) intotwo, and has increased it to almost 3mn t. The quota for HRC, product categoryone, is currently around 1mn t and divided on a country-by-country basis. TheTRA has recommended splitting the product into 1a and 1b, with 1a remainingdistributed as 1 currently is and have an around 1mn t allocation, and with 1bhaving a 1.9 mn t volume that can be sourced from anywhere. 1b is for"downstream processing", which does not include coil being turned intohot-rolled sheet. It will predominantly be used by UK-based producer Tata,although some others, such as tube manufacturers, may also be able to use it.And 1b will have a cap of around 37-42pc, to ensure no one exporter dominatesthe quota. The TRA started a review of the quota in February, in response toTata's increased import requirements as it takes down its blast furnaces aheadof the installation of a 3mn t electric arc furnace in 2027. "We proposemaintaining the current quota volumes for steel used for commercial applicationsand creating a new quota accessible for downstream processing". Sources suggestTata will initially be looking to import around 2mn t of HRC and 1mn t of slabbefore the expansion of its Kalinganagar site in India is complete, after whichit intends to ramp up slab purchases to around 1.5mn t. By Colin Richardson Sendcomments and request more information at feedback@argusmedia.com Copyright ©2024. Argus Media group . All rights reserved.Find out more
Latest metals newsPCI price relativity to PLV climbs to a high09/08/24Latest metals news09/08/24PCI price relativity to PLV climbs to a highShanghai, 9 August (Argus) — Opposing fundamentals in the Australian pulverisedcoal injection (PCI) market and premium low-volatile (PLV) co*king coal marketnarrowed the price spread between the indexes. But it remains to be seen whethermarket conditions will continue to support strength in PCI prices. Marketfundamentals of the two products have been vastly different in the past twomonths, with a mismatch of firm demand and tight supply supporting PCI prices,while PLV continues to decline in an oversupplied market amid a persistentlyweak steel sector. The Argus daily fob Australia assessment for low-volatile PCIincreased by $25/t from 14 June to $205.50/t on 5 July, the highest level since6 November 2023, before gradually declining to $185/t on 8 August. But PCIprices remain high, with July's average relativity to the fob Australia PLVindex at 83pc compared with an average relativity of 61pc in the first half ofthis year. Meanwhile, the Argus -assessed Australian PLV index has fallen by$47.10/t from 2 July to $212.50/t on 31 July, the lowest level since August2022, before making a small recovery to $215/t on 1 August. Prices held steadyfor four days before inching down again to $213.75/t on 8 August in a subduedmarket. Bottlenecks on Russian railways tightening Russians PCI supply anddemand centered in south America, Europe and southeast Asia have contributed tostronger Australian PCI prices. "Russian supply definitely seems tighter thanmany expected, with a lot of term customers scrambling to bring forward orincrease term allocations," an Australian supplier said. "The fob Australia PCImarket is currently a seller's market. Buyers are trying to find out whatcargoes are available but there are hardly any volumes that can be sold on thespot market as term buyers are still trying to increase term volumes." Somebuyers, particularly in northeast Asia, have also looked to reduce theirreliance on Russian coal. "Because of growing US sanctions on Russian suppliers,some buyers are trying to increase their intake of Australian PCI, which is inshort supply, so they may not have many options other than to pay up," aninternational trading source said. But the switch remains unattractive forbuyers with access to Russian supplies as they continued to express reticencetowards the recent increase in Australian PCI prices. A northeast Asian buyerthat was in the market for August-loading PCI eventually bought Russia-originPCI at $165/t on a cfr basis on 23 July, noting its price competitiveness whencompared with indicative offers of Australian low-volatile PCI at about $200/tfob at that time. Expectations that PLV prices would fall further have promptedquestions about whether current PCI prices can continue to remain firm. "The PCImarket remains relatively tight, but if there are end-users in Europe orsoutheast Asia reselling premium hard co*king coal cargoes, it means productionis down and they will not need as much PCI as before," an Australian producersaid. "Effectively, PCI is a co*ke replacement, in that it reduces the amount ofco*ke needed to make a tonne of steel," an international trading firm said. "Soif PCI prices get too close to, or above, the other co*king coal tiers, you wouldjust make more co*ke and use less PCI." Fob Australia PCI vs fob Australia co*kingcoal $/t Send comments and request more information at feedback@argusmedia.comCopyright © 2024. Argus Media group . All rights reserved.Latest metals newsJapan’s Mitsui lifts aluminium ingot offtake in Brazil09/08/24Latest metals news09/08/24Japan’s Mitsui lifts aluminium ingot offtake in BrazilTokyo, 9 August (Argus) — Japanese trading house Mitsui has raised its stake inNippon Amazon Aluminium (NAAC) to increase its offtake of low-carbon aluminumingots produced in Brazil, as it aims to enhance its decarbonisation and metalbusinesses. Mitsui increased its shareholding in NAAC, which has a stake inBrazilian aluminum refiner Aluminio Brasileiro (Albras), to 46pc from thecurrent 21pc for an undisclosed sum. The increased stake will boost Mitsui'sofftake of Albras' aluminum ingots to 140,000 t/yr from the current 80,000 t/yr.It plans to sell the increased offtake mainly to Japanese consumers. The firmhas delivered Albras' low-carbon aluminum ingots mainly to Japanese users. NAAChas a 49pc stake in Albras, which manufactures 450,000 t/yr of aluminum ingots.It cuts carbon dioxide emissions during the production process by usingrenewable power. Mitsui expects increased demand for light, recyclable aluminumproduced with renewable energy with an accelerating decarbonisation trend andaluminum requirements for various goods like vehicles, aircraft, constructionmaterials, cans and electric wire. It also predicts a continued tightness insupplies of low-carbon aluminum. Mitsui also invested in India-based scrapmetals trader and manufacturer MTC Group to take advantage of rising metaldemand in India. By Nanami Oki Send comments and request more information atfeedback@argusmedia.com Copyright © 2024. Argus Media group . All rightsreserved.Latest metals newsMexican ag, LPG prices drive July inflation08/08/24Latest metals news08/08/24Mexican ag, LPG prices drive July inflationHouston, 8 August (Argus) — Gains in agriculture and LPG gas price helped driveMexico's headline inflation in July to its highest level since May 2023,although core price gains continued to ease. The consumer price index (CPI) roseto an annual 5.57pc in July, up from 4.98pc in June and increasing for a fifthconsecutive month, Mexico's statistics agency Inegi said today. A big driverbehind the July reading are fruit and vegetable prices, which climbed by 24pc inJuly, compared with 18pc in June. Farm goods, and tomatoes in particular, havebeen hit by a double dip of bad weather with two months of extreme droughtbefore flooding rains began to hit in late June at an active start to thisyear's hurricane season. Also hitting the consumer price index (CPI), energyinflation reached 9.2pc in July from the same month in 2023. The group was ledby higher LPG prices, up 26pc over last year. Low-octane gasoline prices werenext highest, up 6.9pc. Electricity prices followed, rising 5.35pc on an annualbasis. Domestic natural gas was the only energy item to decline, dropping 3.4pcin July. Banorte, however, stressed that core inflation – which excludesvolatile food and energy – did ease again in July, slowing to 4.05pc for themonth from 4.13pc in June, marking 18 consecutive months of easing. In a note,Banorte said energy prices stand to benefit from base calendar effects in thecoming months. Mexican bank Citibanamex noted the lower core as well in a note,adding how the recent rains are beginning to reach the most drought strickenareas, and this should help begin to contain non-core prices. "We expect annualheadline inflation to resume a gradual downward trend starting in August, and wemaintain our estimates for the end of 2024 at 4.4pc for headline inflation and4.1pc for core inflation," the bank said. The CPI increased by 1.05pc in Junefrom the prior month, when it posted a 0.38pc monthly gain, said Inegi. Thecentral bank's monetary policy committee today lowered its reference interestrate to 10.75pc from 11pc, its first reduction since March. The central bankcited the continued drop in core prices, adding the inflationary environmentmight allow for further rate adjustments, considering "global shocks willcontinue fading and the effects of weakness in economic activity." By JamesYoung Send comments and request more information at feedback@argusmedia.comCopyright © 2024. Argus Media group . All rights reserved.Latest metals newsAustralia lithium companies positive despite low prices07/08/24Latest metals news07/08/24Australia lithium companies positive despite low pricesLondon, 7 August (Argus) — Australian lithium mining firms remain positive thatan upswing in prices towards the middle of the decade will support theiroperations going forward, even though lithium prices are at a five-year low.Lithium prices are bottoming out and should increase later in the decade,according to a number of speakers at the Diggers and Dealers mining forum inKalgoorlie, Western Australia. "It's still a very bright blue sky, but there isa bit of cloud cover passing through. It's no surprise really, given that lowsalways follow periods of highs and the industry went through a strong period ofhighs," Australian mining firm Pilbara Minerals chief executive Dale Hendersonsaid. Price volatility is common in new and rapidly growing industries, such aslithium. The lithium market is connected to the electric vehicle (EV) industry,which has grown from nothing in just a few years. The combination of governmentstimulus measures, technological developments and the different rates ofconsumer adoption are all coming together at the same time, Henderson said."Businesses are rushing to capitalise on the opportunity… It has been volatileand it won't be a straight line and I don't expect it to be a straight line anytime soon." Long-term demand picture unchanged Most mining companies remainedresolute in their long-term goals, despite some industry cutbacks in the firsthalf of this year, maintaining that long-term lithium demand will support theiroperations. Australian producer Core Lithium suspended operations at its Grantsopen pit mine in January. The company is looking for an opportunity to re-enterthe market when prices rise, Core Lithium chief executive Paul Brown said. Hecited multiple industry participants that have said a price of around $18/kg LCEis needed to support this. Argus assessed lithium carbonate prices at$9.70-10.20/kg cif China on 6 August, their lowest since 2021. "We can't, in anindustry as immature as it is, constantly move our strategy from one thing toanother," Australian lithium firm Liontown Resources chief executive TonyOttaviano said. "When you see a 60pc price reduction in six months, there isonly one response a company can do and it is blunt. We need to hold our headswhile others are losing theirs and push through and look at the long term.Having very credible customers that are also strategic in their outlook iscritical to getting that done." The EV market is maturing and despite slowingdemand growth in the US and Europe, EV uptake is expected to continue as newmodels become competitive with internal combustion engine (ICE) vehicles,Ottaviano said. In China, EV prices are already competitive with those of ICEvehicles, he said. "We don't see that yet in North America and Europe, but thatwill come." To meet the expected rise in lithium demand from EV manufacturing,new investment is needed into lithium, which is being discouraged by current lowprices, speakers at the conference said. "The question on supply is, can theindustry turn up with 80 new projects by 2035 that aren't financed yet, by thenext decade? Each of those on average is 20,000t LCE. The investment requiredfor that at the moment is not going to be easy to come by," IGO chief executiveIvan Vella said. IGO owns 49pc of the world's largest lithium mine, Greenbushes,in Western Australia. Argus estimates global lithium demand will rise to 3.2mn tLCE by 2034 ( see grap h ) By Thomas Kavanagh Global lithium demand Globallithium reserves Send comments and request more information atfeedback@argusmedia.com Copyright © 2024. Argus Media group . All rightsreserved.
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