Steel (Iron Ore) 03 (May 17 - Dec 25)

[winston]

China steel output hits record in July at 74 million tonnes: stats bureau

China's steel output hit a monthly record in July at 74.02 million tonnes, up 10.3 percent on a year ago

In the first seven months of the year, steel output totaled 491.55 million tonnes, up 5.1 percent

The most-traded rebar futures SRBcv1 contract has gained nearly 50 percent this year, peaking at 4,016 yuan ($603.15) a tonne last week before retreating to 3,841 yuan a tonne by 0335 GMT on Monday.

Source: Reuters

http://www.reuters.com/article/us-china ... ce=twitter

[behappyalways]

The latest market to go berserk in China: Steel prices
https://www.cnbc.com/2017/08/15/chinese ... china.html

[winston]

Trump ‘rejected Chinese offer to cut steel overcapacity because he wanted to impose tariffs’

US President reported to have dismissed offer of 150 million-tonne reduction despite support from some of his senior advisers

Total US steel imports through July were up 22 per cent from the same period a year ago, t

Source: SCMP

http://www.scmp.com/news/china/diplomac ... ercapacity

[winston]

Malaysia: Steel shares rally on expectations of lower supply

by Leong Hung Yee

PETALING JAYA: Shares of steel companies on Bursa Malaysia spiked in afternoon trading on Thursday as steel output may drop in coming months.

Bloomberg reported that steel output may drop in coming months as Asia’s top economy presses ahead with supply-side reforms. Hebei province, the center of China’s mammoth steel industry, has plans that will allow for winter output cuts of as much as 50% to reduce pollution.

Companies such as Southern Steel, Ann Joo, Malaysia Steel Works (Kl) and Press Metal are among the actively traded counters on Bursa Malaysia.

Southern Steel jumped 7.17%, or 17 sen to RM2.54, its highest since late 1997, with 2.47 million shares exchanged hands.

Ann Joo Resources rose 4.35% , or 16 sen to RM3.84, its all time high, with more than two million shares traded. The stock rose about 23% in the past month.

Masteel added 12 sen to RM1.68 while Lion Industries Corp rose 0.5 sen to RM1.47,

Reuters reported higher prices have also been fuelled by concerns of capacity curbs during the coming winter after the Ministry of Environmental Protection (MEP) pledged to reduce hazardous pollutants in the country’s north, including key producing province Hebei, by halving steel output by up to 50%.

Some inspection teams have already been sent to eight provinces in August, according to the MEP.

China’s stockpiles of rebar, a construction steel product, rose to 3.88 million tonnes by the end of August.

Source: The Star

http://www.thestar.com.my/business/busi ... 7CW7w7y.99

[winston]

Chart of the day: Shanghai steel shines

by Nicole Elliott

Just as we had thought six weeks ago, the lagging line of the Ichimoku cloud chart system of the Shanghai steel rebar futures did get a lift from the horizontal top of the large triangle pattern.

Then early in August, not only did we get the strong close we hoped for, but with a Marabuzo candle, too, which was a bullish sign.

Now we have reached the first measured target from the height of the right-angled triangle at 4,500 yuan (US$688.61) per tonne and, though overbought, strong bullish momentum means it should probably continue on to the final Fibonacci retracement resistance at 4,625 yuan.

Because moving averages are still steadily positive, we remind that a squeeze to 4,900 to 5,000 yuan cannot be ruled out – even though position trimming has taken place during the summer months.

Source: SCMP

http://www.scmp.com/business/commoditie ... eel-shines

[winston]

China steel output to rise despite closure of mills

China's steel output is expected to grow 3 percent to 5 percent in 2017 compared with last year, despite the closure of small outdated mills as surging prices prompted larger players to raise their production, said a trade body official.

The world's largest steel producer will make about 840 million tonnes of crude steel this year, said Qu Xiuli, vice president at China Iron and Steel Association. Last year, the country produced 808 million tonnes of steel.

Steel output at member steel firms of the association - each with annual capacity of over one million tonnes - rose 6.8 percent in the first seven months this year, while small steel mills saw a 2 percent drop in production from last year.

That comes after Beijing's crackdown that shut 120 million tonnes of low-tech steel capacity in the first half of this year and a continuing series of environmental inspections in a bid to curb pollution.

"The Chinese steel sector is upgrading and the industry concentration ratio is rising," said Qu.

Of the 808 million tonnes of steel produced last year, only about 36 percent was produced by the top 10 largest steel mills in China, and their portion is expected to increase this year.

China has been striving to streamline its heavy industries to reduce debt burdens and produce more high value products.

Export prices for steel products in the first seven months of the year rose 43.3 percent to US$686 (HK$5,350.80) a tonne from a year earlier, according to CISA.

Source: REUTERS

[winston]

Iron Ore Sinks as 'Peak Steel' Call, Supply Angst Rattle Market

By Jasmine Ng and David Ingles

CRU’s Butterworth says steel demand in China may face pullback
Benchmark price drops into the $60s after a four-day tumble

1. Persistent concern about rising global supply
2. Fresh questions about the outlook for demand in China and
3. Warning from Australia’s central bank that the top buyer may be nearing peak steel

Iron ore is coming under pressure as weakening data from China have undermined the outlook for the coming months at the same time as the top steelmaker plans output cuts over winter to ease pollution.

Citigroup Inc. said in a report on Wednesday it expected iron ore fall to $53 next year, with the drop driven by rising supply and concern over a China slowdown.

Australian exports may expand to 880 million tons next year from 841 million in 2017, while Brazil’s rise to 407 million from 385 million, it said.

Source: Bloomberg

https://www.bloomberg.com/news/articles ... gn=markets

[winston]

[b]Iron Ore Price Fall Is Inevitable[/b]

Iron ore price has retreated by 21% in spot and 20% in China domestic futures.

The direct trigger was China’s tightening of its anti-pollution policies ahead of the heating season, which resulted in a decline in iron ore demand.

We calculate that the steel capacity limits in “2+26” cities should reduce steel production of 4.5m tonnes, translating to impact iron ore demand by 7.0m to 7.5m tonnes.

Fundamentally, a fall in iron ore price is evitable given its unchanged oversupply situation.

Source: UOBKH

https://research.uobkayhian.com/content ... cf4818e96e

[winston]

BHP says Steel Demand to Surge Under China’s Belt and Road

By Adam Routh

BHP Billiton (BHP.AU) says that China's Belt and Road initiative could result in up to 150 million tonnes of additional steel demand, which will drive demand for raw materials.

The Belt and Road (BRI) project is President Xi Jinping's adaptation of the historical Silk Road connecting China with 68 countries covering Eurasia, parts of Africa and Oceania.

In a report released on Monday, the world's biggest miner identified 400 core infrastructure projects spanning power, railways and pipelines costing an estimated USD1.3 trillion which will 'help to sustain Chinese steel production run rates at high levels over the next decade":

Such investment would drive significant demand for construction materials and equipment, leading to an increase in direct and indirect demand for steel. BRI projects could result in up to 150 million tonnes of incremental steel demand.

Of that amount, 80 per cent would be used in structures and reinforced concrete, with 20 per cent going into machinery and other equipment.

Spread over a 10-year period, this amounts to an additional 15 million tonnes per annum, or 3 per cent to 4 per cent incremental demand growth for steel in BRI regions. This is considerable, as it would double the growth rate of local steel demand observed since 2011.
BHP expects Chinese steel production to peak in the middle of the next decade:

We believe that China will ultimately double its accumulated stock of steel in use, which is currently about 6 tonnes per capita. Among the range of possibilities we consider, our base case remains that Chinese steel production is yet to peak.

The most likely timing of the peak is the middle of next decade. The growth rate we assume is close to 1 per cent. Notably, the annualised steel production run-rate in China hit 891Mt in June 2017, while the half-year to June came in at 846Mt. Both figures are comfortably above the historical annual high of 823Mt achieved back in 2014.’

BHP noted that of the 68 countries, only 10 are net steel exporters, while the rest rely on steel imports to some extent and more than 20 countries do not have any steel smelting capacity at all.

Source: Barron's Asia

http://www.barrons.com/articles/bhp-say ... 1506496044

[winston]

Chinese steelmakers still under-reporting output despite pollution crackdown, study finds

Production in top steelmaking province of Hebei has been higher than claimed, despite government’s war on smog

The research, released on Friday by the think tank, suggested coal consumption from power stations, steelmakers and household heaters contributes to most of northern China’s notorious smog.

Source: SCMP

http://www.scmp.com/news/china/policies ... ing-output