Articles in Category: Company News

This morning in metals news: the Consumer Price Index (CPI) for All Urban Consumers increased by 0.9% in June, the Bureau of Labor Statistics reported today; meanwhile, U.S. crude oil production efficiency increased in the Bakken region in 2020; and, lastly, North American Stainless experienced a production slowdown late last week.

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Consumer Price Index up 0.9%

Consumer Price Index

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The Consumer Price Index for All Urban Consumers increased by 0.9% in June, the Bureau of Labor Statistics reported today.

The index had jumped by 0.6% in May.

The June jump marked the largest one-month increase since June 2008, the BLS reported, when the index jumped by 1.0%.

US crude oil production efficiency up in Bakken

Crude oil production efficiency increased in the Bakken region in 2020, the Energy Information Administration reported.

However, the Bakken region proved to be the only US region with a rise in production efficiency last year.

“In 2020, U.S. initial crude oil production per well, or well production efficiency, increased significantly in the Bakken region, according to our Drilling Productivity Report (DPR), which we update monthly,” the EIA reported. “Productivity in other drilling regions remained largely steady or decreased slightly, DPR data shows.”

NAS delays

Last week, Bloomberg reported production challenges at North American Stainless’ (NAS) facility in Ghent, Kentucky, reporting a shortage of industrial gases that impacted operations and caused it to declare force majeure.

NAS accounts for approximately 40% of the U.S. stainless steel market.

However, a source told MetalMiner that NAS sent letters to customers rescinding the force majeure and had only opted to reduce, rather than halt, production. The slowdown will result in delays of about two weeks, MetalMiner has learned, and will largely impact September order books.

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The Rare Earths Monthly Metals Index (MMI) fell 2.7% for the July MMI reading.

July 2021 Rare Earths MMI chart

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First shipment establishes new US-EU rare earths supply chain

Energy Fuels Inc. and Neo Performance Materials Inc. announced that they have executed the first shipment of mixed rare earth carbonate from a mill in Utah to a separation facility in Estonia.

On July 7, Energy Fuels announced the first shipment, containing approximately 20 metric tons of the mixed rare earth carbonate, from the White Mesa Mill in Utah. The material was en route to Neo Performance Materials’ rare earths separation facility.

The announcement represents the start of a fledgling U.S.-E.U. rare earths supply chain. Both the U.S. and the E.U. have long sought to mitigate dependence on China, which dominates an overwhelming majority of rare earths mining and refining.

The shipment marked the first of an expected 15 containers of carbonate to be sent to the Estonia facility, Energy Fuels said in the July 7 announcement.

“Additional shipments of RE Carbonate are expected as Energy Fuels continues to process natural monazite sand ore mined in Georgia (U.S.) by Chemours for both the rare earth elements and naturally occurring uranium that it contains,” Energy Fuels said.

Monazite is produced as a byproduct of existing heavy mineral sands mining, Energy Fuels said. The material also contains naturally occurring uranium that Energy Fuels recovers for use in the generation of carbon-free nuclear energy, the company added.

Furthermore, the companies announced the signing of a contract for a definitive supply agreement.

“Under the Agreement, Colorado-based Energy Fuels will ship all or a portion of its RE Carbonate to Neo’s Silmet rare earth separations facility,” Energy Fuels added. “Neo will then process Energy Fuels’ RE Carbonate into separated rare earth materials for use in rare earth permanent magnets and other rare earth-based advanced materials.”

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The Stainless Monthly Metals Index (MMI) increased by 2.1% for this month’s reading.

July 2021 Stainless MMI chart

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Nickel pig iron replacement

As steel prices continue to rally, stainless steel producers in China seem to be saving costs by replacing refined nickel with nickel pig iron (NPI). NPI is a lower-nickel-content substitute for refined nickel.

Satellite service SAVANT, which tracks smelter activity, reported that nickel smelting activity was lower than seasonally expected. The company claimed global nickel activity for June was at its lowest in five years.

At the same time, NPI smelting activity in China grew significantly, making April and June the highest readings in the past five years.

Tentative agreement between ATI, USW

After a three-months strike, Allegheny Technologies Inc (ATI) and the United Steelworkers (USW) reached a tentative agreement on July 2.

The agreement includes onetime payments, wage increases and a premium-free health insurance plan for union members. As soon as the agreement is signed, USW members are expected to resume work.

The strike affected approximately 1,300 workers in specialty rolled products locations across nine locations: Brackenridge, Latrobe, Natrona Heights, Vandergrift, Washington (Pennsylvania), Lockport (New York), Louisville (Ohio), New Bedford (Massachusetts) and Waterbury (Connecticut).

The specialty rolled products include a variety of stainless steel sheets, specialty coils, cold rolled stainless steel, and stainless and specialty alloy plates. More specifically, these plants produce: light gauge cold rolled stainless steel strip; titanium strip and sheet; nickel; precision rolled strip; cold rolled stainless; and alloys, such as high-temperature, corrosion-resistant, nickel-based and duplex.

As MetalMiner previously reported, the ATI strikes constrained U.S. stainless flat-rolled supply. For months, industrial metal buying organizations faced serious challenges in purchasing metal, not only due to the supply constraint but also because stainless steel prices are at an all-time high. In addition, soaring freight rates have also made imports a costly proposition.

Base price consolidates

After U.S. mills announced their fourth base price increase of the year in June, no further increases were announced for July.

U.S. mills have increased prices on products, which reduce available production capacity. Alloys other than 304, 304L and 316L have been subject to greater increases. Non-standard widths and light gauge extras have risen several times in the last six months.

Buyers should expect additional extras increases as mills continue to optimize their product mix to maximize volume.

Alloy surcharges are increasing in July. NAS’ July alloy surcharge for 304 is $0.9930/lb, an increase of $0.0318/lb compared to June.

Actual metals prices and trends

The Allegheny Ludlum 304 stainless surcharge ticked up by 3.0% month over month to $1.02 per pound this month. Meanwhile, the Allegheny Ludlum 316 surcharge surged to $1.45 per pound.

Chinese 316 cold rolled coil dropped 0.6% to $3,903 per metric ton as of July 1. Meanwhile, 304 cold rolled coil climbed 2.5% to $2,865 per metric ton. Chinese primary nickel surged by 0.5% to $21,093 per metric ton.

LME three-month nickel jumped 3.3% to $18,440 per metric ton.

Indian primary nickel declined by 1.4% to $18.20 per kilogram.

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This morning in metals news: General Motors reported strong Q2 sales in China; miner Anglo American said it had completed its first maritime biofuel trial; and, lastly, the copper price has trended sideways so far in July.

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General Motors reports strong China sales in Q2

General Motors headquarters

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General Motors reported its Q2 sales with its joint ventures in China rose by 5.2%.

The automaker said vehicle deliveries totaled more than 750,000.

“The growth was driven by luxury and premium vehicles, midsize/large SUVs and MPVs, including the Cadillac CT5 and XT6, and Buick LaCrosse, Enclave and GL8 family,” GM said. “Sales of new energy vehicles (NEVs) across GM’s brands also posted a strong performance.”

GM also touted the expansion of its Ultium platform to China.

“In addition to offering popular EVs underpinned by SAIC-GM-Wuling’s locally developed GSEV platform, GM is bringing to China its advanced global EV platform – Ultium – which will empower a range of multi-brand and multi-segment EVs,” GM said. “The first Ultium-based model for China, the Cadillac LYRIQ all-electric SUV, made its global public debut at Auto Shanghai 2021, before it goes on sale early next year.”

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Before we head into the weekend, let’s take a look back at the week that was and the metals storylines here on MetalMiner, including coverage of aluminum prices, U.S. auto sales, a Saudi-Emirati oil output spat and much more:

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Week of July 5-9 (aluminum prices, U.S. auto sales and much more)

aluminum ingot

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This morning in metals news: the United Steelworkers union this week announced it had reached a tentative deal with Allegheny Technologies Inc. (ATI) to end a three-month strike; meanwhile, Ford China’s sales rose by 24% in the first half of the year; and, lastly, the U.S. and Mexico announced a course of remediation under the United States-Mexico-Canada Agreement (USMCA) Rapid Response Labor Mechanism.

The MetalMiner Best Practice Library offers a wealth of knowledge and tips to help buyers stay on top of metals markets and buying strategies.

USW announces tentative deal to end ATI strike

strike

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The United Steelworkers union in late March announced a strike at nine ATI facilities, citing “unfair labor practices.”

About three months later, that strike appears to be at an end.

The union this week announced it had reached a tentative deal on a four-year contract with ATI to end the labor stoppage.

“Broadly, the proposed agreement provides lump sum payments, meaningful wage increases and maintains a premium-free health insurance plan for union members without establishing a permanent lower tier of benefits for new hires,” the USW said in a release earlier this month.

“If the proposed agreement is ratified, the recall process would begin immediately, and USW members are expected to return to work shortly after the ratification process is complete.”

Ford China touts sales rise

Ford China reported its first-half sales jumped by 24%.

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This morning in metals news: miner Rio Tinto and POSCO, South Korea’s largest steel producer, have signed a memorandum of understanding (MoU) to work toward a low-carbon-emission steel value chain; meanwhile, Steel Dynamics announced plans to reach carbon neutrality by 2050; and, lastly, U.S. job openings were little changed in May from the previous month.

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Rio Tinto, POSCO sign climate MoU

Rio Tinto sign

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Rio Tinto and South Korea’s largest steel producer, POSCO, have signed an MoU aimed at a greener steel value chain.

“The partnership will explore a range of technologies for decarbonisation across the entire steel value chain from iron ore mining to steelmaking, including integrating Rio Tinto’s iron ore processing technology and POSCO’s steelmaking technology,” Rio Tinto said in a release.

Both companies aim to reach net-zero carbon emissions by 2050.

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This morning in metals news: U.S. steel capacity utilization rose to 83.0% last week; meanwhile, the U.S. Department of Commerce is now requiring and collecting aluminum import licenses; and, lastly, General Motors said it will source U.S.-based lithium.

The MetalMiner Best Practice Library offers a wealth of knowledge and tips to help buyers stay on top of metals markets and buying strategies.

Steel capacity utilization reaches 83.0%

hot rolled steel

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The U.S. steel capacity utilization rate reached 83.0% last week, the American Iron and Steel Institute reported.

Steel production during the week totaled 1,842,000 net tons. The output marked an increase of 0.4% from the previous week and a 41.0% jump year over year.

Furthermore, output in the year to date reached 46,896,000 net tons at a steel capacity utilization rate of 79.0%.

DOC to collect aluminum import licenses

As part of the Aluminum Import Monitoring system, the Department of Commerce recently announced it began requiring and collecting aluminum import licenses as of June 28.

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Before we head into the weekend, let’s take a look back at the week that was and some of the metals storylines here on MetalMiner.

This week, we touched on the USMCA (which turned 1 on Thursday), Stuart Burns covered the relationship between inventory levels and metals demand, and much more.

On the USMCA — which went into effect July 1, 2020, almost four years after NAFTA talks began — United States Trade Representative Katherine Tai offered some comments this week on the occasion.

“We should also celebrate the USMCA because of what it represents: a renewed commitment by our three countries to pursue negotiations that raise standards and create a race to the top,” she said.

Furthermore, USMCA trade ministers will meet in Mexico City on July 7 to commemorate the one-year anniversary of the trade agreement.

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Week of June 28-July 2 (USMCA, metal stock levels and more)

USMCA

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  • The global lead and zinc markets were in surplus through the first four months of 2021, the International Lead and Zinc Study Group said.
  • Meanwhile, GDP rose in all 50 states in the first quarter, the Bureau of Economic Analysis (BEA) reported.
  • In addition, Stuart Burns covered Russia’s plans to impose export taxes on key metals.
  • U.S. steel capacity utilization for the week ending June 26 reached 82.7%, the American Iron and Steel Institute reported.
  • The U.S. Court of International Trade made a ruling affirming duty levels set by the Department of Commerce with respect to heavy walled rectangular steel pipes and tubes from Korea.
  • Burns on the loss of support for the zinc price.
  • The E.U. voted to extend steel safeguards, originally imposed in 2018, for an additional three years.
  • The USMCA Labor Council convened for the first time, pursuant to the 1-year-old agreement’s chapter on labor.
  • Think stock levels are a reliable indicator of true metals demand? Think again.
  • Norsk Hydro has signed a letter of intent to build an aluminum recycling plant in Michigan.
  • Meanwhile, the United States-Mexico-Canada Agreement, or USMCA, hit the one-year mark this Thursday.
  • The U.S. goods and services deficit rose in May from the previous month.
  • Lastly, for subscribers, the MetalMiner Monthly Outlook for July is now available.

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This morning in metals news: the U.S. goods and services deficit rose by $2.2 billion in May; meanwhile, new orders for manufactured goods rose in May; and, lastly, Ford Motor Co. released its June sales results.

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US goods and services deficit increases in May

U.S. trade

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The U.S. goods and services deficit rose by $2.2 billion in May to $71.2 billion, the Census Bureau reported.

The deficit increased from $69.1 billion the previous month.

Furthermore, May exports reached $206.0 billion, or up $1.3 billion from the previous month. Meanwhile, May imports reached $277.3 billion, or up $3.5 billion.

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