The US government announced preliminary determination in the countervailing duty investigation on imports of prestressed concrete steel wire strand from China, according to a statement released by the Commerce Department on Tuesday.
The department said that Chinese producers and exporters of prestressed concrete steel wire stand have received net countervailable subsidies ranging from 7.53 to 12.06 percent.
As a result of this preliminary determination, the Commerce Department will instruct US Customs and Border Protection to collect a cash deposit or bond on imports prestressed concrete steel wire strand from China.
In 2008, imports of prestressed concrete steel wire strand from China were valued at an estimated 178 million US dollars, up from 112 million dollars in 2006.
The petition was filed on May 27, 2009. The US International Trade Commission (ITC) made its preliminary determination on July 13.
The Commerce Department is scheduled to issue its final determination in January 2010.
If the Commerce Department makes an affirmative final determination, and the U.S. ITC makes an affirmative final determination that imports of prestressed concrete wire strand from China materially injure, or threaten material injury to, the domestic industry, the department will issue a countervailing duty order in March 2010.
Trade disputes between China and the US increased this year since the US economy has been experiencing the worst recession after the Great Depression in 1930s.
US President Barack Obama announced in September to impose punitive tariffs on all car and light truck tires from China for three years. The Commerce Department launched an investigation that could lead to new tariffs on Chinese seamless steel pipes on Oct.7.
Chinese Commerce Minister Chen Deming said the US punitive tariffs on Chinese tires is a serious act of protection, which will not only damage bilateral trade but also hurt US interests.
"There is rising protectionism in the US against Chinese goods," said Derek Scissors, a research fellow at the Heritage foundation's Asian Studies Center, noting that the harm will be inevitably passed on to consumers.
Even Secretary of Commerce Gary Locke admitted that protectionism is not the right way to solve problem.
"The United States may have a large trade imbalance with the rest of the world right now, but the answer is not to reduce our imports. It's to make and sell more products and services that the rest of the world wants to buy." the Secretary said in August.
Sunday 31 January 2010
Steel prices up
A work site at a plant in East China's Jiangsu Province. Figures from Mysteel show domestic steel prices have increased for successive four weeks, driven up by factory price hikes by steel giants like Baosteel and Wuhan Iron and Steel. The composite index of domestic steel prices rose to 136 points, up 6.5 percent year on year last weekend. Photo: Image China
Baosteel to hike key August steel prices
China's Baosteel will raise prices of its major steel products by 9 to 13 percent next month, more than expected, the biggest one-off increase since Baosteel moved from quarterly to monthly prices last May.
Baoshan Iron and Steel Co Ltd, the listed unit of China's largest steel mill, will increase hot and cold-rolled steel products by 9 to 13 percent compared to July, Reuters reported yesterday, citing trade sources.
The move, some analysts said, may suggest the steel mills have effectively given up their battle for lower iron ore prices.
"I think it could mean that Baosteel has agreed to follow the price cut that Rio Tinto and Japanese steel mills signed," said Cui Jingyi, analyst, Guotai & Junan Securities.
Rio in May agreed to a 33-percent cut in its annual selling price to most of its major Asian customers outside China, but China's mills have been arguing for a return to 2007 prices, implying a cut of at least 40 percent on purchases from Rio, BHP Billiton and Vale.
But earlier this month a Shanghai-based newspaper, citing unnamed "informed sources", said the China Iron and Steel Association had agreed to the 33-percent price cut. Steel executives and Rio denied a deal, but most analysts still say that the price is all but inevitable.
Some analysts criticized Baosteel's move as "inappropriate" as it may give the foreign iron ore suppliers leverage in their long-term price talks with Chinese steel mills.
Baosteel's August price rises will be the third monthly increase in a row, taking prices to their highest since November, when the scale of the collapse in global demand was becoming clear.
It raised the price of straight-carbon hot-rolled steel coil by 350 yuan ($51.24) per ton, while increasing the price of low-carbon hot-rolled steel coil by 500 yuan a ton.
The company also raised the price of cold-rolled steel coil by 500 yuan a ton, trade sources said, adding that they were surprised by the price hikes.
Some analysts said Baosteel's sharp price hikes were supported by a recovery in demand and exports, but others said prices were driven up by speculation, doubting the impact of real demand.
China's crude steel output reached 45.39 million tons in June, data from the China Iron and Steel Association showed, equivalent to annual production of 552.2 million tons, more than 10 percent above 2008 output of 500 million tons.
The production boost reflected improved earnings among Chinese steel mills, which said they started to be profitable in May after seven straight months in the red.
Baoshan Iron and Steel Co Ltd, the listed unit of China's largest steel mill, will increase hot and cold-rolled steel products by 9 to 13 percent compared to July, Reuters reported yesterday, citing trade sources.
The move, some analysts said, may suggest the steel mills have effectively given up their battle for lower iron ore prices.
"I think it could mean that Baosteel has agreed to follow the price cut that Rio Tinto and Japanese steel mills signed," said Cui Jingyi, analyst, Guotai & Junan Securities.
Rio in May agreed to a 33-percent cut in its annual selling price to most of its major Asian customers outside China, but China's mills have been arguing for a return to 2007 prices, implying a cut of at least 40 percent on purchases from Rio, BHP Billiton and Vale.
But earlier this month a Shanghai-based newspaper, citing unnamed "informed sources", said the China Iron and Steel Association had agreed to the 33-percent price cut. Steel executives and Rio denied a deal, but most analysts still say that the price is all but inevitable.
Some analysts criticized Baosteel's move as "inappropriate" as it may give the foreign iron ore suppliers leverage in their long-term price talks with Chinese steel mills.
Baosteel's August price rises will be the third monthly increase in a row, taking prices to their highest since November, when the scale of the collapse in global demand was becoming clear.
It raised the price of straight-carbon hot-rolled steel coil by 350 yuan ($51.24) per ton, while increasing the price of low-carbon hot-rolled steel coil by 500 yuan a ton.
The company also raised the price of cold-rolled steel coil by 500 yuan a ton, trade sources said, adding that they were surprised by the price hikes.
Some analysts said Baosteel's sharp price hikes were supported by a recovery in demand and exports, but others said prices were driven up by speculation, doubting the impact of real demand.
China's crude steel output reached 45.39 million tons in June, data from the China Iron and Steel Association showed, equivalent to annual production of 552.2 million tons, more than 10 percent above 2008 output of 500 million tons.
The production boost reflected improved earnings among Chinese steel mills, which said they started to be profitable in May after seven straight months in the red.
Eight dead in steel plant accident
Eight steel workers were confirmed dead on arrival to hospital Monday in Dalian, a coastal city in northeastern China's Liaoning province, local work safety watchdog said Tuesday morning.
According to Yang Jikui, head of the city's work safety bureau, the eight workers fainted suddenly at around 4:45 pm Monday when they were repairing an electrical device in a small underground pump workshop in the No. 1 steel plant of Dalian Special Steel Co. Ltd., affiliated to the Dongbei Special Steel Group.
Yang said preliminary blood tests showed no sign the victims had been electrocuted, but there were signs of carbon monoxide and other unidentified gases in the blood.
However, according to doctors the workers could have died of serious oxygen deficiency, as the 1.45-m-deep underground workshop had a floor space of only a dozen square meters or so and had been closed for a long period of time.
Yang said experts would try to ascertain the cause of deaths after autopsy Tuesday.
According to Yang Jikui, head of the city's work safety bureau, the eight workers fainted suddenly at around 4:45 pm Monday when they were repairing an electrical device in a small underground pump workshop in the No. 1 steel plant of Dalian Special Steel Co. Ltd., affiliated to the Dongbei Special Steel Group.
Yang said preliminary blood tests showed no sign the victims had been electrocuted, but there were signs of carbon monoxide and other unidentified gases in the blood.
However, according to doctors the workers could have died of serious oxygen deficiency, as the 1.45-m-deep underground workshop had a floor space of only a dozen square meters or so and had been closed for a long period of time.
Yang said experts would try to ascertain the cause of deaths after autopsy Tuesday.
Wuhan Iron and Steel to expand output by 24% next year
Wuhan Iron and Steel Group (Wugang), China's third-largest steel maker, plans to increase production by 24 percent next year as demand recovers amid the reviving economy.
Wugang expected to produce 37.9 million tonnes of crude steel next year, up from a forecasted 30.5 million tonnes this year, and it raised revenue expectation by 11 percent to 150 billion yuan (22 billion US dollars) in 2010, according to the statement.
China's 4-trillion yuan stimulus package has helped domestic steel makers return to profit in May after seven straight months of losses because of the global economic crisis.
Steel consumption might rise by 10 percent next year due to a stronger demand boosted by a 28-percent-increase in assets investment in 2010, Yu Liangui, a senior analyst from Mysteel, was quoted as saying.
"The government's plan to restrict entry for small steel makers gives ample room for large steel mills to expand production," according to Yu.
The Ministry of Industry and Information Technology earlier this month said it would be mandatory for steel mills to have at least 1 million tonnes of capacity, a move that could squeeze small steel mills out of the market and speed up the pace of industry consolidation.
Wugang expected to produce 37.9 million tonnes of crude steel next year, up from a forecasted 30.5 million tonnes this year, and it raised revenue expectation by 11 percent to 150 billion yuan (22 billion US dollars) in 2010, according to the statement.
China's 4-trillion yuan stimulus package has helped domestic steel makers return to profit in May after seven straight months of losses because of the global economic crisis.
Steel consumption might rise by 10 percent next year due to a stronger demand boosted by a 28-percent-increase in assets investment in 2010, Yu Liangui, a senior analyst from Mysteel, was quoted as saying.
"The government's plan to restrict entry for small steel makers gives ample room for large steel mills to expand production," according to Yu.
The Ministry of Industry and Information Technology earlier this month said it would be mandatory for steel mills to have at least 1 million tonnes of capacity, a move that could squeeze small steel mills out of the market and speed up the pace of industry consolidation.
Chinese equities gain 1.37%, led by car and steel-makers
Chinese stocks gained 1.37 percent Thursday, boosted by car and steel-makers, after two straight days of losses.
The benchmark Shanghai Composite Index on the Shanghai bourse closed at 3,123.03 points, up 42.26 points. The Shenzhen Component Index closed at 12,637.94 points, up 149.36 points, or 1.2 percent.
Total turnover expanded to about 285 billion yuan (41.71 billion US dollars) from 254.4 billion yuan on the previous trading day.
Gainers outnumbered losers by 734 to 125 in Shanghai and 646 to 95 in Shenzhen.
Auto shares led the gains after the China Association of Automobile Manufacturers reported a 36.48 percent surge in sales of China-made automobiles to 1.14 million units in June.
A total of 872,000 passenger cars, including SUVs and sedans, were sold last month, up 48 percent from the same month a year earlier, the association said Thursday.
Tianjin FAW XIALI Automobile Co. rose by the daily limit of 10 percent to end at 9.02 yuan. FAW Car Co. advanced 9.95 percent to 18.23 yuan. SAIC Motor gained 8.63 percent to 19 yuan.
Steel producers also helped push up the index as Chinese steel mills produced about 45.39 million tonnes of crude steel, the highest amount in this year, figures from the China Iron and Steel Association showed.
Chongqing Iron and Steel Company rose 9.98 percent to 6.17 yuan. Baoshan Iron and Steel Co. gained 1.87 percent to 8.18 yuan.
Medical shares also performed well after the State Council, or the Cabinet, agreed at a conference Wednesday to expand basic medical insurance to another 72 million people this year as the first-year goal for the country's three-year 850-billion-yuan health care reform plan.
Sichuan Joint-Wit Medical and Pharmaceutical Group Co. rose by the daily limit of 10 percent to 12.53 yuan. Zhejiang Huahai Pharmaceutical Co. rose by the daily limit of 10 percent to 15.40 yuan.
The benchmark Shanghai Composite Index on the Shanghai bourse closed at 3,123.03 points, up 42.26 points. The Shenzhen Component Index closed at 12,637.94 points, up 149.36 points, or 1.2 percent.
Total turnover expanded to about 285 billion yuan (41.71 billion US dollars) from 254.4 billion yuan on the previous trading day.
Gainers outnumbered losers by 734 to 125 in Shanghai and 646 to 95 in Shenzhen.
Auto shares led the gains after the China Association of Automobile Manufacturers reported a 36.48 percent surge in sales of China-made automobiles to 1.14 million units in June.
A total of 872,000 passenger cars, including SUVs and sedans, were sold last month, up 48 percent from the same month a year earlier, the association said Thursday.
Tianjin FAW XIALI Automobile Co. rose by the daily limit of 10 percent to end at 9.02 yuan. FAW Car Co. advanced 9.95 percent to 18.23 yuan. SAIC Motor gained 8.63 percent to 19 yuan.
Steel producers also helped push up the index as Chinese steel mills produced about 45.39 million tonnes of crude steel, the highest amount in this year, figures from the China Iron and Steel Association showed.
Chongqing Iron and Steel Company rose 9.98 percent to 6.17 yuan. Baoshan Iron and Steel Co. gained 1.87 percent to 8.18 yuan.
Medical shares also performed well after the State Council, or the Cabinet, agreed at a conference Wednesday to expand basic medical insurance to another 72 million people this year as the first-year goal for the country's three-year 850-billion-yuan health care reform plan.
Sichuan Joint-Wit Medical and Pharmaceutical Group Co. rose by the daily limit of 10 percent to 12.53 yuan. Zhejiang Huahai Pharmaceutical Co. rose by the daily limit of 10 percent to 15.40 yuan.
German steel retracts
German steel output will fall by 30 percent this year to a level last seen in 1963, sector federation WVS said Monday even as overall industrial output posted a sharp increase.
Ministry: EU tariffs on Chinese steel wire rods unnecessary
European Union trade officials approved duties on imported Chinese steel wire rods on Monday. Duties of up to 24 percent are expected to be levied on imports from early August, according to a resolution passed by the European Union.
European producers have claimed that Chinese producers had sold products at low prices and hurt their businesses.
China's steel wire rod exports to the EU had shrunk since China imposed a 15-percent export duty last year, and it would not injure the steel industry of the EU, said the official.
Figures from the London-based Iron and Steel Statistics Bureau showed China had become a net steel importer in the second quarter of this year.
The EU launched a series of anti-dumping probes against steel and iron products imported from China last year, but dropped the threat of duties against galvanized steel sheet and cold-rolled products.
European producers have claimed that Chinese producers had sold products at low prices and hurt their businesses.
China's steel wire rod exports to the EU had shrunk since China imposed a 15-percent export duty last year, and it would not injure the steel industry of the EU, said the official.
Figures from the London-based Iron and Steel Statistics Bureau showed China had become a net steel importer in the second quarter of this year.
The EU launched a series of anti-dumping probes against steel and iron products imported from China last year, but dropped the threat of duties against galvanized steel sheet and cold-rolled products.
US Steel calls for imposition of 90% duties on Chinese pipe imports
US Steel Corp asked the US Commerce Department Wednesday to impose dumping and anti-subsidy duties of as much as 90 percent on some Chinese steel-pipe imports, dealing another blow to the already hurting Chinese steel industry.
Roger Schagrin, a lawyer for the US producers, said the petition was filed with the US International Trade Commission against $400 million in imports of pipes used in chemical, petrochemical, refineries and related operations, Bloomberg reported.
"Once you give in to trade protectionism, it will only provoke more such actions," an unidentified Chinese Ministry of Commerce spokesman told the news agency.
Similar warnings were heard days ago when Obama set safeguard tariffs on Chinese tires.
"What the tire decision has done is say that the White House door is open to protectionism," Gary Hufbauer, a fellow at the Peterson Institute for International Economics, was quoted by Bloomberg as saying.
As early as April 8, US steel makers filed an anti-dumping suit to US trade officials for investigation into China-exported steel pipes.
On the same day, the European Union lumbered Chinese exporters in its preliminary rulings with provisional dumping duties for their refractory exports to the EU, according to the Xinhua News Agency.
Despite the fact that the industry makes profits in China, the EU investigation again didn't apply market economy terms to Chinese exporters, and thus miscalculated the human resource costs in their investigation, which led to the dumping verdict, according to China's International Herald Leader newspaper.
Together with the harsh low-price competition from other countries, the export of Chinese steel products could drop dramatically as much as 80 percent in 2009, the China Iron and Steel Association warned.
Roger Schagrin, a lawyer for the US producers, said the petition was filed with the US International Trade Commission against $400 million in imports of pipes used in chemical, petrochemical, refineries and related operations, Bloomberg reported.
"Once you give in to trade protectionism, it will only provoke more such actions," an unidentified Chinese Ministry of Commerce spokesman told the news agency.
Similar warnings were heard days ago when Obama set safeguard tariffs on Chinese tires.
"What the tire decision has done is say that the White House door is open to protectionism," Gary Hufbauer, a fellow at the Peterson Institute for International Economics, was quoted by Bloomberg as saying.
As early as April 8, US steel makers filed an anti-dumping suit to US trade officials for investigation into China-exported steel pipes.
On the same day, the European Union lumbered Chinese exporters in its preliminary rulings with provisional dumping duties for their refractory exports to the EU, according to the Xinhua News Agency.
Despite the fact that the industry makes profits in China, the EU investigation again didn't apply market economy terms to Chinese exporters, and thus miscalculated the human resource costs in their investigation, which led to the dumping verdict, according to China's International Herald Leader newspaper.
Together with the harsh low-price competition from other countries, the export of Chinese steel products could drop dramatically as much as 80 percent in 2009, the China Iron and Steel Association warned.
US Steel reports quarterly loss on weak demand
US Steel Corp., the largest US -based steel maker, reported quarterly loss Tuesday on weak demand.
The Pittsburgh-based company said it lost $392 million during the second quarter as the global recession hurt demand. Quarterly revenue fell 68 percent to $2.13 billion.
It was the company's second straight quarterly loss. In April, the company posted its first quarterly loss in more than five years, citing anemic demand.
Shares of US Steel Corp shares fell 2.2 percent to 40.35 dollars after the company said it expected all of its business sectors to operate in the red in the third quarter.
US Steel has already laid off thousands of workers and temporarily idled plants since steel demand plunged amid the credit crisis and economic slowdown late last year.
The Pittsburgh-based company said it lost $392 million during the second quarter as the global recession hurt demand. Quarterly revenue fell 68 percent to $2.13 billion.
It was the company's second straight quarterly loss. In April, the company posted its first quarterly loss in more than five years, citing anemic demand.
Shares of US Steel Corp shares fell 2.2 percent to 40.35 dollars after the company said it expected all of its business sectors to operate in the red in the third quarter.
US Steel has already laid off thousands of workers and temporarily idled plants since steel demand plunged amid the credit crisis and economic slowdown late last year.
Steel plant begins production in Afghanistan
The first-ever steel plant in the Afghan capital Kabul and second in the post-Taliban country has been inaugurated and started production, a private television channel reported Tuesday.
Established with 1 million US dollars preliminary investment and inaugurated Monday, the plant produces 100 tons of steel rods daily, Tolo reported in its bulletin.
This is the second steel factory built in the war-torn Afghanistan. A similar plant with more capacity began production in the western Herat province months ago.
Despite continued militancy in parts of Afghanistan, accelerating reconstruction activities mostly by private sector is largely tangible especially in the fields of communication and housing in the country.
Established with 1 million US dollars preliminary investment and inaugurated Monday, the plant produces 100 tons of steel rods daily, Tolo reported in its bulletin.
This is the second steel factory built in the war-torn Afghanistan. A similar plant with more capacity began production in the western Herat province months ago.
Despite continued militancy in parts of Afghanistan, accelerating reconstruction activities mostly by private sector is largely tangible especially in the fields of communication and housing in the country.
Yuan up in NDFs; U.S.-China trade disputes flare up
* U.S. sets more duties on China steel pipes
* Trade disputes add pressure on yuan appreciation
* But Chinese c.bank seems not ready to change yuan policy
* Yuan peg unsustainable in long run says academic
SHANGHAI, Nov 6 - The yuan rose slightly against the dollar in benchmark offshore non-deliverable forwards on Friday, buoyed by news that the United States slapped preliminary anti-dumping duties on Chinese-made oil well pipes in the biggest U.S. trade action against China.
The duties, which ranged up to 99 percent on Chinese-made oil well pipes and comes a week before U.S. President Barack Obama heads to Asia on a trip that includes stops in Shanghai and Beijing, signalled that the United States was stepping up pressure on China to give concessions in trade, dealers said.
In Sino-American disputes on trade, the yuan has always been a focus as U.S. critics say China purposefully keeps its currency undervalued to gain advantages, while China blames the United States on other issues, including U.S. restrictions on exports of high-technology products to China.
"Each time when senior U.S. officials come to China, currency has always be a major topic," said a dealer at an Asian bank in Shanghai. "NDFs responded to the U.S. duty news today, although China typically doesn't yield to U.S. pressure in this issue."
China on Friday denounced as protectionist the new U.S. anti-dumping duties and vowed to protect the interests of its industry.
Offshore one-year dollar/yuan NDFs fell slightly to 6.6300 bid at midday on Friday compared with Thursday's close of 6.6430.
Twelve-month yuan appreciation implied by NDFs, which moves inversely with the forwards, rose to 2.98 percent measured from the Chinese central bank's daily mid-point, compared with 2.78 percent implied at Thursday's close.
However, in a sign that Beijing is not ready to change its stable yuan policy, the People's Bank of China fixed the yuan's daily mid-point, or reference rate by which the yuan can only rise or fall 0.5 percent in a day, almost unchanged at 6.8276 versus the dollar from Thursday's 6.8277.
In response, onshore spot yuan was nearly flat as well, trading at 6.8275 at midday on Friday, compared with Thursday's close of 6.8276.
The Chinese central bank has kept the yuan at a virtual peg against the dollar since July 2008, confined to a range of only about 100 pips, partly to help insulate China's exports from the turmoil of the global financial crisis.
But with the worst of the crisis now likely over, and China's economy recovering faster than its major trading partners, Western policy makers have renewed calls for Beijing to allow the yuan to appreciate to help address trade imbalances.
Chinese academics are deeply divided on whether Beijing should retain the yuan/dollar peg.
A senior government economist, Zhang Yuyan, said late on Thursday that the yuan's de facto dollar peg was unsustainable in the long run, citing factors including expected increasing pressure on currency policy in the coming months.
In another sign of changing expectations of the yuan's long-term trend, offshore benchmark one-year dollar/yuan volatilities, by which investors hedge their risks in the yuan/dollar exchange rate, jumped to 5.6 percent bid at midday on Friday from Thursday's close of 5.25 percent.
* Trade disputes add pressure on yuan appreciation
* But Chinese c.bank seems not ready to change yuan policy
* Yuan peg unsustainable in long run says academic
SHANGHAI, Nov 6 - The yuan rose slightly against the dollar in benchmark offshore non-deliverable forwards on Friday, buoyed by news that the United States slapped preliminary anti-dumping duties on Chinese-made oil well pipes in the biggest U.S. trade action against China.
The duties, which ranged up to 99 percent on Chinese-made oil well pipes and comes a week before U.S. President Barack Obama heads to Asia on a trip that includes stops in Shanghai and Beijing, signalled that the United States was stepping up pressure on China to give concessions in trade, dealers said.
In Sino-American disputes on trade, the yuan has always been a focus as U.S. critics say China purposefully keeps its currency undervalued to gain advantages, while China blames the United States on other issues, including U.S. restrictions on exports of high-technology products to China.
"Each time when senior U.S. officials come to China, currency has always be a major topic," said a dealer at an Asian bank in Shanghai. "NDFs responded to the U.S. duty news today, although China typically doesn't yield to U.S. pressure in this issue."
China on Friday denounced as protectionist the new U.S. anti-dumping duties and vowed to protect the interests of its industry.
Offshore one-year dollar/yuan NDFs fell slightly to 6.6300 bid at midday on Friday compared with Thursday's close of 6.6430.
Twelve-month yuan appreciation implied by NDFs, which moves inversely with the forwards, rose to 2.98 percent measured from the Chinese central bank's daily mid-point, compared with 2.78 percent implied at Thursday's close.
However, in a sign that Beijing is not ready to change its stable yuan policy, the People's Bank of China fixed the yuan's daily mid-point, or reference rate by which the yuan can only rise or fall 0.5 percent in a day, almost unchanged at 6.8276 versus the dollar from Thursday's 6.8277.
In response, onshore spot yuan was nearly flat as well, trading at 6.8275 at midday on Friday, compared with Thursday's close of 6.8276.
The Chinese central bank has kept the yuan at a virtual peg against the dollar since July 2008, confined to a range of only about 100 pips, partly to help insulate China's exports from the turmoil of the global financial crisis.
But with the worst of the crisis now likely over, and China's economy recovering faster than its major trading partners, Western policy makers have renewed calls for Beijing to allow the yuan to appreciate to help address trade imbalances.
Chinese academics are deeply divided on whether Beijing should retain the yuan/dollar peg.
A senior government economist, Zhang Yuyan, said late on Thursday that the yuan's de facto dollar peg was unsustainable in the long run, citing factors including expected increasing pressure on currency policy in the coming months.
In another sign of changing expectations of the yuan's long-term trend, offshore benchmark one-year dollar/yuan volatilities, by which investors hedge their risks in the yuan/dollar exchange rate, jumped to 5.6 percent bid at midday on Friday from Thursday's close of 5.25 percent.
US preliminary ruling to impose punitive tariffs on Chinese oil pipes
The US Commerce Department has made the preliminary decision Thursday of imposing as much as 99 percent in punitive tariffs on China-imported tubular steel goods used in the oil and gas industry.
According to the preliminary decision, 37 Chinese companies will be imposed a punitive tariff of 36.53 percent, while some other companies will receive a preliminary dumping rate of up to 99.14 percent.
The department claimed that the selling price of Chinese-exported tubular steel goods in the US market was less than the normal market, ranging from zero to 99.14 percent.
According to statistics from the US Commerce Department, the total amount of Chinese-made tubular steel goods exported to the US was valued at $2.6 billion.
This decision was an addition to the preliminary extra duties of 10.69 percent to 30.69 percent for Chinese oil pipes the Commerce Department announced in September.
"The anti-dumping ruling is unfair to Chinese producers who sold the pipes in the US at a 20 percent premium to our domestic prices," said Li Liancang, an export manager from Tianjin Pipe Group Co., a State-owned Chinese producer. "Chinese pipe exports to the US have almost stopped since the preliminary ruling in September," he added.
Chinese steel exports to the US in the first eight months slumped 73 percent year-on-year, the China Iron & Steel Association said last month.
On Friday China condemned the new US tariffs on imports of Chinese tubular steel goods, saying it was an "abuse of protectionism."
"China firmly opposes the abuse of protectionism and will take measures to seriously protect the interests of the domestic industry," the Commerce Ministry said in a statement on its website.
According to the preliminary decision, 37 Chinese companies will be imposed a punitive tariff of 36.53 percent, while some other companies will receive a preliminary dumping rate of up to 99.14 percent.
The department claimed that the selling price of Chinese-exported tubular steel goods in the US market was less than the normal market, ranging from zero to 99.14 percent.
According to statistics from the US Commerce Department, the total amount of Chinese-made tubular steel goods exported to the US was valued at $2.6 billion.
This decision was an addition to the preliminary extra duties of 10.69 percent to 30.69 percent for Chinese oil pipes the Commerce Department announced in September.
"The anti-dumping ruling is unfair to Chinese producers who sold the pipes in the US at a 20 percent premium to our domestic prices," said Li Liancang, an export manager from Tianjin Pipe Group Co., a State-owned Chinese producer. "Chinese pipe exports to the US have almost stopped since the preliminary ruling in September," he added.
Chinese steel exports to the US in the first eight months slumped 73 percent year-on-year, the China Iron & Steel Association said last month.
On Friday China condemned the new US tariffs on imports of Chinese tubular steel goods, saying it was an "abuse of protectionism."
"China firmly opposes the abuse of protectionism and will take measures to seriously protect the interests of the domestic industry," the Commerce Ministry said in a statement on its website.
CNPC, UMW Holdings' JV starts operation in Qinhuangdao
Zhongyou BSS (Qiangdao) Petropipe involves a total investment of RMB 1.3 billion. The Chinese firm holds a 51% stake in the JV, and UMW Holdings owns the remaining 49%.
Malaysia's Prime Minister Datuk Seri Najib Tun Razak attended the opening ceremony of the JV and said the move is in line with the country's call to encourage Malaysian companies to invest abroad, especially in China.
The JV is capable of producing 400,000 tons of oil and gas transmission pipes, which will be used for the second China West-East Gas Pipeline Project from Khazakstan to Shanghai, Sino-Russian Crude Oil Pipeline Project and Sino-Burmese Crude Oil Pipeline Project.
Feng Wensheng, general manager of Zhongyou BSS (Qiangdao) Petropipe, estimated that the firm's output could exceed 250,000 tons in 2009 with sales revenue exceeding RMB 2 billion.
So far, the JV is the UMW's sixth plant in China as well as the firm's largest investment in the country.
Malaysia's Prime Minister Datuk Seri Najib Tun Razak attended the opening ceremony of the JV and said the move is in line with the country's call to encourage Malaysian companies to invest abroad, especially in China.
The JV is capable of producing 400,000 tons of oil and gas transmission pipes, which will be used for the second China West-East Gas Pipeline Project from Khazakstan to Shanghai, Sino-Russian Crude Oil Pipeline Project and Sino-Burmese Crude Oil Pipeline Project.
Feng Wensheng, general manager of Zhongyou BSS (Qiangdao) Petropipe, estimated that the firm's output could exceed 250,000 tons in 2009 with sales revenue exceeding RMB 2 billion.
So far, the JV is the UMW's sixth plant in China as well as the firm's largest investment in the country.
Thai-German Products closes plant, shares down
BANGKOK, March 17 - Thai-German Products , Thailand's leading stainless steel pipe maker, said on Tuesday it had shut down all production at its plant in the eastern province of Rayong, which would affect 5-7 percent of its annual sales.
The news sent its stock down 3.85 percent to 0.25 baht at 0302 GMT, while the overall Thai stock market was 0.05 percent lower.
The shutdown was mainly due to a dispute between the company and its labour union, which had demanded bonuses and other benefits for the 2008 performance, the company said in a statement.
Thai-German has more than 4,000 tonnes of finished goods and raw material which should satisfy sales for at least four-to-six months, it said.
The company has combined capacity of more than 50,000 tonnes a year of stainless steel pipes, tubes and sheets for industrial use.
The news sent its stock down 3.85 percent to 0.25 baht at 0302 GMT, while the overall Thai stock market was 0.05 percent lower.
The shutdown was mainly due to a dispute between the company and its labour union, which had demanded bonuses and other benefits for the 2008 performance, the company said in a statement.
Thai-German has more than 4,000 tonnes of finished goods and raw material which should satisfy sales for at least four-to-six months, it said.
The company has combined capacity of more than 50,000 tonnes a year of stainless steel pipes, tubes and sheets for industrial use.
To slow down further revenue losses, makers are probing emerging outlets and offering the previous term’s price points.
Additional tariffs are compelling China suppliers of pipes and pipe fittings to seek new marketing strategies to stay afloat. This is a result of the US and the EU having tacked anti-dumping duties on China-made imports of steel pipes for use in the oil and gas industries.
Already, formal protests have been lodged in several international trade bodies but the majority of enterprises plan to sustain production while waiting for the restrictions to be lifted.
The measures are expected to constrain shipments further and reduce China’s steel pipe delivery to the EU and the US by more than 40 percent in the months ahead. In 3Q09, steel pipe exports to both destinations fell 85 and 79 percent, respectively, year on year.
The US, meanwhile, is continuing investigations on unfair trade practices, particularly on producers of seamless copper pipes with more than 152.4mm length and less than 308.102mm diameter. More countries are expected to follow the US and the EU’s lead. Argentina, for instance, intends to pursue similar proceedings for carbon steel alloy pipes with a diameter of less than 273.1mm.
So far, tariffs imposed against China seamless metal pipe manufacturers have forced about 70 percent of their rank to stall or limit production. On the other hand, a few enterprises still see the US and the EU as profitable outlets, and are prepared to strengthen their foothold in the markets and pay the extra levies.
To minimize revenue losses, most makers are planning to reroute shipments to the domestic market and to their customary big buyers in Algeria, India and Singapore. Other possible overseas destinations are South America and Africa.
With burgeoning demand from the homefront, steel industry associations in China are likewise lobbying for 13 to 17 percent tax rebates on certain metal products. The government is still considering this appeal.
Steel pipes, which account for 50 percent of the country’s total output, remain in great demand for a range of applications such as those for gas conduits and boiler tubes. From January to September 2009, production reached 15.4 million tons of seamless designs worth $3.3 billion. During this period, crude steel output grew 8 percent year on year to reach 420 million tons.
Most China makers plan to maintain quotes of metal pipes at present levels as a means of attracting new buyers and retaining existing clients. This approach is agreeable since increases in raw material costs for the next six months are projected to be just within 5 to 10 percent.
In September 2009, hot-rolled steel was pegged at $500 per ton, an 11 percent jump in spot prices from April 2009. At the same time, deformed units peaked at $560 per ton for a 24 percent upturn.
Steel pipes and pipe fittings, together with stainless variants, are the most common metal products in China, although aluminum and copper types are widely available. These can be made of the 200, 300 or 400 series and are electroplated with zinc.
Seamless models are quoted from $3,000 to $6,000 per ton. The dimension and metal grade account for the price variations. Export duties can also raise rates by 5 to 10 percent in the next six months.
Designs made of higher-grade steel have better heat and corrosion resistance and are suited for exterior installation and exposure to mildly caustic environment. Moreover, their tensile strength is hardly reduced even when subjected to welding, postweld annealing or similar processes.
In the plastic segment, PVC, PE, PP and PB are the common materials used. The first three types dominate the market because of their light weight, high strength and low reactivity. For instance, PVC pipes can be fused together easily using common solvent cements or simple heat treatments, resulting in watertight joints.
More than 80 percent of pipes used for water distribution and heating supply are made of plastic. This is because the material resists bacteria more effectively than metal, which can rust and contaminate the water on prolonged use. China’s plastic output is projected to rise by over 20 percent annually and reach 6 million tons in 2015.
Similar to the metal sector, prices in this category are generally seen to remain stable in next few months. Depending on the size and material, plastic models go for $400 to $800 per ton. HDPE variants are 30 to 40 percent more expensive than PVC.
Domestic PVC went for $1,000 per ton in November 2009, 8 percent higher than March rates. PP costs climbed from $1,400 per ton in April last year to $1,500 per ton in November.
Already, formal protests have been lodged in several international trade bodies but the majority of enterprises plan to sustain production while waiting for the restrictions to be lifted.
The measures are expected to constrain shipments further and reduce China’s steel pipe delivery to the EU and the US by more than 40 percent in the months ahead. In 3Q09, steel pipe exports to both destinations fell 85 and 79 percent, respectively, year on year.
The US, meanwhile, is continuing investigations on unfair trade practices, particularly on producers of seamless copper pipes with more than 152.4mm length and less than 308.102mm diameter. More countries are expected to follow the US and the EU’s lead. Argentina, for instance, intends to pursue similar proceedings for carbon steel alloy pipes with a diameter of less than 273.1mm.
So far, tariffs imposed against China seamless metal pipe manufacturers have forced about 70 percent of their rank to stall or limit production. On the other hand, a few enterprises still see the US and the EU as profitable outlets, and are prepared to strengthen their foothold in the markets and pay the extra levies.
To minimize revenue losses, most makers are planning to reroute shipments to the domestic market and to their customary big buyers in Algeria, India and Singapore. Other possible overseas destinations are South America and Africa.
With burgeoning demand from the homefront, steel industry associations in China are likewise lobbying for 13 to 17 percent tax rebates on certain metal products. The government is still considering this appeal.
Steel pipes, which account for 50 percent of the country’s total output, remain in great demand for a range of applications such as those for gas conduits and boiler tubes. From January to September 2009, production reached 15.4 million tons of seamless designs worth $3.3 billion. During this period, crude steel output grew 8 percent year on year to reach 420 million tons.
Most China makers plan to maintain quotes of metal pipes at present levels as a means of attracting new buyers and retaining existing clients. This approach is agreeable since increases in raw material costs for the next six months are projected to be just within 5 to 10 percent.
In September 2009, hot-rolled steel was pegged at $500 per ton, an 11 percent jump in spot prices from April 2009. At the same time, deformed units peaked at $560 per ton for a 24 percent upturn.
Steel pipes and pipe fittings, together with stainless variants, are the most common metal products in China, although aluminum and copper types are widely available. These can be made of the 200, 300 or 400 series and are electroplated with zinc.
Seamless models are quoted from $3,000 to $6,000 per ton. The dimension and metal grade account for the price variations. Export duties can also raise rates by 5 to 10 percent in the next six months.
Designs made of higher-grade steel have better heat and corrosion resistance and are suited for exterior installation and exposure to mildly caustic environment. Moreover, their tensile strength is hardly reduced even when subjected to welding, postweld annealing or similar processes.
In the plastic segment, PVC, PE, PP and PB are the common materials used. The first three types dominate the market because of their light weight, high strength and low reactivity. For instance, PVC pipes can be fused together easily using common solvent cements or simple heat treatments, resulting in watertight joints.
More than 80 percent of pipes used for water distribution and heating supply are made of plastic. This is because the material resists bacteria more effectively than metal, which can rust and contaminate the water on prolonged use. China’s plastic output is projected to rise by over 20 percent annually and reach 6 million tons in 2015.
Similar to the metal sector, prices in this category are generally seen to remain stable in next few months. Depending on the size and material, plastic models go for $400 to $800 per ton. HDPE variants are 30 to 40 percent more expensive than PVC.
Domestic PVC went for $1,000 per ton in November 2009, 8 percent higher than March rates. PP costs climbed from $1,400 per ton in April last year to $1,500 per ton in November.
Saturday 30 January 2010
Baosteel's H1 profit hits RMB 9.645 bln
Baoshan Iron and Steel Co Ltd<600019>, China's largest steel producer, said its net profit rose 18.2% year on year to RMB 9.645 billion for the first half of this year, according to the interim report of the Shanghai-listed company.
Revenue in the period was up 10.11% year-on-year to RMB 103.6 billion. However, the operating cash flow dropped from RMB 5.54 billion to RMB 2.77 billion in the first half, due to rising costs. Earnings per share were RMB 0.55.
The company attributed the profit rise to the surging sales prices of steel and relatively lower energy costs achieved by applying new technologies and improving its product structure.
Baosteel targets to achieve a revenue of RMB 200 billion for the full year of 2008. Revenue earned in the first half accounted for 51.82%. However, the company said in the second half, it would face pressure from the tight coal supply, the increasing price of iron ore and a possible decline in demand growth.
In view of sluggish demand from China's automobile and home appliance sectors, the company announced earlier this week that it would lower its fourth-quarter cold-rolled and hot-rolled steel product prices by RMB 300 and RMB 200 respectively, from the fourth quarter of this year.
Revenue in the period was up 10.11% year-on-year to RMB 103.6 billion. However, the operating cash flow dropped from RMB 5.54 billion to RMB 2.77 billion in the first half, due to rising costs. Earnings per share were RMB 0.55.
The company attributed the profit rise to the surging sales prices of steel and relatively lower energy costs achieved by applying new technologies and improving its product structure.
Baosteel targets to achieve a revenue of RMB 200 billion for the full year of 2008. Revenue earned in the first half accounted for 51.82%. However, the company said in the second half, it would face pressure from the tight coal supply, the increasing price of iron ore and a possible decline in demand growth.
In view of sluggish demand from China's automobile and home appliance sectors, the company announced earlier this week that it would lower its fourth-quarter cold-rolled and hot-rolled steel product prices by RMB 300 and RMB 200 respectively, from the fourth quarter of this year.
Steel H1 net profit down 12 pct
Steel-to-property conglomerate CITIC Pacific said on Thursday its first-half net profit fell 12 percent due to a lack of gains from disposals, but strong growth in special steel and infrastructure businesses helped partly offset the high comparison effect.
Beijing-backed CITIC Pacific, which has shifted its investment focus to mainland China and diversified into retail and power, posted a net profit of HK$4.38 billion ($561 million) in the first six months of 2008.
That compared with profit of HK$4.97 billion in the same period last year when its booked a HK$1.9 billion profit from the listing of CITIC 1616 .
Shares in CITIC Pacific lost 34 percent in the first half, underperforming a 20.5 percent drop on the blue chip Hang Seng Index <.HSI> in the same period. ($1=HK$7.807)
29 Jan, 2010 Indian steel price index reflects continued downward trend
Long Products
PI - Product Index
Flat Products
| Category | 27-Jan | 28-Jan | Change | % |
| PI - TMT | 6579 | 6419 | -160 | -2.4% |
| PI - WRC | 7343 | 7343 | 0 | 0.0% |
| PI - Angle | 6433 | 6363 | -70 | -1.1% |
| PI - Channel | 6497 | 6433 | -64 | -1.0% |
| PI - Joist | 5924 | 5954 | 30 | 0.5% |
PI - Product Index
Flat Products
| Category | 27-Jan | 28-Jan | Change | % |
| PI - Narrow Plates | 7150 | 7124 | -25 | -0.4% |
| PI - Wide Plates | 7240 | 7185 | -55 | -0.8% |
| PI - Hot Rolled | 7253 | 7237 | -17 | -0.2% |
| PI - Cold Rolled | 8032 | 7990 | -42 | -0.5% |
| PI - Galvanized | 8028 | 8034 | 7 | 0.1% |
Iranian steel pipe prices decrease due to weak demand
It is reported that because of the weak welded pipe market demand, some of Iran's local distributors have reduced their stock offer price by USD 15 per tonne to USD 45 per tonne.
However, Iran's tube & pipe producers have not been willing to reduce their offer price at this moment they believed their offer price is already the bottom.
Now, in Iran domestic market, the welded pipe price in January is the same as its price level in last December; the offer price of welded pipe of EN 10219 or DIN 2394 with OD 8" and thickness 2mm to 6mm is about USD 740 per tonne to USD 750 per tonne the price for same standard's square tube is also the same level.
Due to the raising raw material price in global steel market, Iran's pipe producers might have higher possibility to raise their price in the coming months but the weak domestic demand might show some impact on their decision.
However, Iran's tube & pipe producers have not been willing to reduce their offer price at this moment they believed their offer price is already the bottom.
Now, in Iran domestic market, the welded pipe price in January is the same as its price level in last December; the offer price of welded pipe of EN 10219 or DIN 2394 with OD 8" and thickness 2mm to 6mm is about USD 740 per tonne to USD 750 per tonne the price for same standard's square tube is also the same level.
Due to the raising raw material price in global steel market, Iran's pipe producers might have higher possibility to raise their price in the coming months but the weak domestic demand might show some impact on their decision.
Chinese steel mills differ on pricing policy for February
Hebei Iron and Steel announced EXW prices for February day before yesterday.
According to the report prices of most products’ remained unchanged and only for few products’ prices would rise by CNY 50 per tonne to CNY 60 per tonne.
However, HR and CR orders will enjoy a discount of CNY 100 per tonne, which actually decreases EXW prices for these two main categories in flat products.
In other words, Hebei Iron and Steel has become the pioneer in prices reduction for these categories.
Before Hebei Iron and Steel, BaoSteel Angang Bengang and Wugang have already released their pricing policies for February. After BaoSteel announced that it would not change prices for February, Wugang raised prices by declining preferential margins whereas Angang Bengang Shougang and Baotou Iron and Steel increased prices directly.
Analyst Hu Yanping from Joint Metal said "As a steel mill with the second largest output in China Hebei Iron and Steel’s pricing policy may not play a decisive role in pricing policies for others but it would certainly become one of the factors for reference."
According to the report prices of most products’ remained unchanged and only for few products’ prices would rise by CNY 50 per tonne to CNY 60 per tonne.
However, HR and CR orders will enjoy a discount of CNY 100 per tonne, which actually decreases EXW prices for these two main categories in flat products.
In other words, Hebei Iron and Steel has become the pioneer in prices reduction for these categories.
Before Hebei Iron and Steel, BaoSteel Angang Bengang and Wugang have already released their pricing policies for February. After BaoSteel announced that it would not change prices for February, Wugang raised prices by declining preferential margins whereas Angang Bengang Shougang and Baotou Iron and Steel increased prices directly.
Analyst Hu Yanping from Joint Metal said "As a steel mill with the second largest output in China Hebei Iron and Steel’s pricing policy may not play a decisive role in pricing policies for others but it would certainly become one of the factors for reference."
Friday 29 January 2010
29 Jan, 2010 Chinese steel rebar prices continue to decrease
| Location | In CNY | In USD |
| Beijing | -22 | -3 |
| Changsha | -14 | -2 |
| Chengdu | 0 | 0 |
| Chongqing | -10 | -1 |
| Fuzhou | 0 | 0 |
| Guangzhou | -19 | -3 |
| Guiyang | -23 | -3 |
| Hangzhou | 0 | 0 |
| Harbin | 0 | 0 |
| Hefei | 0 | 0 |
| Jinan | 0 | 0 |
| Kunming | 0 | 0 |
| Lanzhou | 0 | 0 |
| Nanchang | -9 | -1 |
| Nanjing | 0 | 0 |
| Shanghai | 0 | 0 |
| Shenyang | 0 | 0 |
| Shijiazhuang | 0 | 0 |
| Taiyuan | 0 | 0 |
| Tianjin | 0 | 0 |
| Wuhan | 0 | 0 |
| Xian | 0 | 0 |
| Zhengzhou | 0 | 0 |
| Average | -4 | -1 |
Steel Prices Rising in the West as China Plunges
Advance/Decliner Index Remains Flat
Our Advance/Decliner Index remained almost unchanged at 82% this week after falling from 90% the week before. Pricing strength persists with a record number of price increases reported in a single week in the history of our index. But receding strength in China mitigated the surge in prices elsewhere. Our China index plunged from 100% to 43%, the lowest level since October 2009. We believe this is primarily driven by last week’s Chinese central bank decision raising reserve requirements, which sent a shudder throughout markets in China, and steel is typically among the most speculative of markets in the region. Chinese pricing leader Baosteel surprised the market leading February sheet prices flat – we believe this is 150% negotiating tactic – targeting the iron ore talks – and couldn’t possibly be more transparent either.
Domestic Prices Surge; Rebar Posts Strong Week
The US posted 13 price increases this week, followed by Europe and Turkey with four, China and South Korea with three, Japan, Brazil, the UK, Taiwan, and North Africa with two, and one a piece for the CIS, India, Thailand, the UAE, Pakistan, Iran, Singapore, Malaysia and Russia. China had four price decreases, followed by the US and India with two, and Japan and Turkey with one price decline each. There were 15 price increases for flat-rolled products, followed by rebar with nine, while structural had five, merchant bar and pipe had four, and plate, wire rod, and billet had three price increases apiece. Flat-rolled products and rebar each had three price decreases, followed by beam with two, and merchant bar and billet with one each.
Relative Domestic Prices Running Up
January domestic rebar prices are up 12% from December and have posted a sharp increase – off of near-record lows - relative to China and Europe where prices have increased modestly, and versus Japan where prices have fallen 7%. Plate prices have risen 14% in January, and are up significantly relative to China and Europe where prices are flattish. Absolute HRC prices in the US have risen 16% this month, and are up sharply relative to China, Europe, and Japan. While posted beam prices in the US seemingly increased 6% in January, showing an increase relative to other regions, we think the posted prices are wrong so that beam prices in the US are most probably down versus other regions.
Outlook
The Chinese price shocks this week were in reaction to announcements; more steel trades in speculative hands in China than all other regions combined, so shocks are anything-but unusual. The US market surged this week as it continues to lag global prices which are still rising from higher raw material costs and low inventories. We remain bullish on global prices, including China.
Our Advance/Decliner Index remained almost unchanged at 82% this week after falling from 90% the week before. Pricing strength persists with a record number of price increases reported in a single week in the history of our index. But receding strength in China mitigated the surge in prices elsewhere. Our China index plunged from 100% to 43%, the lowest level since October 2009. We believe this is primarily driven by last week’s Chinese central bank decision raising reserve requirements, which sent a shudder throughout markets in China, and steel is typically among the most speculative of markets in the region. Chinese pricing leader Baosteel surprised the market leading February sheet prices flat – we believe this is 150% negotiating tactic – targeting the iron ore talks – and couldn’t possibly be more transparent either.
Domestic Prices Surge; Rebar Posts Strong Week
The US posted 13 price increases this week, followed by Europe and Turkey with four, China and South Korea with three, Japan, Brazil, the UK, Taiwan, and North Africa with two, and one a piece for the CIS, India, Thailand, the UAE, Pakistan, Iran, Singapore, Malaysia and Russia. China had four price decreases, followed by the US and India with two, and Japan and Turkey with one price decline each. There were 15 price increases for flat-rolled products, followed by rebar with nine, while structural had five, merchant bar and pipe had four, and plate, wire rod, and billet had three price increases apiece. Flat-rolled products and rebar each had three price decreases, followed by beam with two, and merchant bar and billet with one each.
Relative Domestic Prices Running Up
January domestic rebar prices are up 12% from December and have posted a sharp increase – off of near-record lows - relative to China and Europe where prices have increased modestly, and versus Japan where prices have fallen 7%. Plate prices have risen 14% in January, and are up significantly relative to China and Europe where prices are flattish. Absolute HRC prices in the US have risen 16% this month, and are up sharply relative to China, Europe, and Japan. While posted beam prices in the US seemingly increased 6% in January, showing an increase relative to other regions, we think the posted prices are wrong so that beam prices in the US are most probably down versus other regions.
Outlook
The Chinese price shocks this week were in reaction to announcements; more steel trades in speculative hands in China than all other regions combined, so shocks are anything-but unusual. The US market surged this week as it continues to lag global prices which are still rising from higher raw material costs and low inventories. We remain bullish on global prices, including China.
The Best Way He’s Found to Feed
Joe Hardcastle on the best way he’s found to feed his Angus and Brangus crossed with horned Hereford cattle: Using GoBob’s hay feeders
When Joe Hardcastle took home a new insert for his GoBob hay feeders, he did not expect to be quite as impressed as he was. “I saw them at a Springfield show and brought one home to try,” he stated while standing in his barn, surrounded by trucks from his main business, JH Excavating. “After working with their demonstrator, I liked it so well, I immediately ordered four more.”
As Bob Studebaker, owner of GoBob Feeders explained, “we were one of the first to offer a hay conserving feeder and the first to offer a square-shaped feeder for round bales. Sometimes something new is difficult to get accepted by the public so we offered an unconditional money back guarantee, if the customer did not feed 25 percemt less hay than they were previously feeding with a ring feeder. This winter (2008-2009) we have surpassed over 6,000 feeders sold since its inception. We now confidently offer the same money back guarantee and have upped the anty to 30 percent less hay fed. Joe Hardcastle was the very first to purchase one and then called back to
order more.”ay Conserver Bale Feeder with Bull and Cattle
“I run about 140 cattle, on three different pieces of property,” Joe Hardcastle continued. “I came to
Lebanon 40 years ago, working in the lumber industry, and now I run this.” He waved an arm to take in the lot in front of the barn, filled with trucks of varying sizes and descriptions, all associated with excavation and construction. “I grew up on a farm in Ozark County, along the Missouri- Arkansas line. I did 4-H as a kid, and that life is something I’ve always loved. My wife,” he laughed. “She doesn’t care for the cows, but I do.” Sherrill Hardcastle runs her own monogramming business, all on the same property as Joe’s excavating business and the majority of his cattle. “This is a hobby that I love. That’s the best way I can describe it,” Joe continued. “I moved to Lebanon from Springfield in 1969 and worked in the lumber yards for 26 years. You know, you’d go to work every day, with all the hustle, and have people yelling at you about this or that, but then to come home and work with the cows, now to me, that’s relaxing. The only problem now, with these cell phones, is that they can find you anywhere, even out in the field. The only way you can truly find any peace is if you shut this thing off,” he added, as he pulled his cell phone out of his coveralls front pocket. He shook his head, with a smile. “I run a Brangus-Angus mix and breed them to horned Hereford bulls, which I get out of Kansas, and that gets you black baldy calves. I’ve been doing it that way for years. I feed straight hay in the winter, with salt mineral range cubes and they winter real well that way. And the GoBob feeders, all I can say is that they really do save on the hay. There’s not a lot of money in the cattle these days, but well, they really are my therapy at the end of the day.”
When Joe Hardcastle took home a new insert for his GoBob hay feeders, he did not expect to be quite as impressed as he was. “I saw them at a Springfield show and brought one home to try,” he stated while standing in his barn, surrounded by trucks from his main business, JH Excavating. “After working with their demonstrator, I liked it so well, I immediately ordered four more.”
As Bob Studebaker, owner of GoBob Feeders explained, “we were one of the first to offer a hay conserving feeder and the first to offer a square-shaped feeder for round bales. Sometimes something new is difficult to get accepted by the public so we offered an unconditional money back guarantee, if the customer did not feed 25 percemt less hay than they were previously feeding with a ring feeder. This winter (2008-2009) we have surpassed over 6,000 feeders sold since its inception. We now confidently offer the same money back guarantee and have upped the anty to 30 percent less hay fed. Joe Hardcastle was the very first to purchase one and then called back to
order more.”ay Conserver Bale Feeder with Bull and Cattle
“I run about 140 cattle, on three different pieces of property,” Joe Hardcastle continued. “I came to
Lebanon 40 years ago, working in the lumber industry, and now I run this.” He waved an arm to take in the lot in front of the barn, filled with trucks of varying sizes and descriptions, all associated with excavation and construction. “I grew up on a farm in Ozark County, along the Missouri- Arkansas line. I did 4-H as a kid, and that life is something I’ve always loved. My wife,” he laughed. “She doesn’t care for the cows, but I do.” Sherrill Hardcastle runs her own monogramming business, all on the same property as Joe’s excavating business and the majority of his cattle. “This is a hobby that I love. That’s the best way I can describe it,” Joe continued. “I moved to Lebanon from Springfield in 1969 and worked in the lumber yards for 26 years. You know, you’d go to work every day, with all the hustle, and have people yelling at you about this or that, but then to come home and work with the cows, now to me, that’s relaxing. The only problem now, with these cell phones, is that they can find you anywhere, even out in the field. The only way you can truly find any peace is if you shut this thing off,” he added, as he pulled his cell phone out of his coveralls front pocket. He shook his head, with a smile. “I run a Brangus-Angus mix and breed them to horned Hereford bulls, which I get out of Kansas, and that gets you black baldy calves. I’ve been doing it that way for years. I feed straight hay in the winter, with salt mineral range cubes and they winter real well that way. And the GoBob feeders, all I can say is that they really do save on the hay. There’s not a lot of money in the cattle these days, but well, they really are my therapy at the end of the day.”
Steel and Pipe Used for Anything from Cars to Construction
There are probably as many different Stainless steel pipe products on offer in the market as there are different uses for them - and with steel used in almost anything from construction to packaging, it's hard to keep track of all the different types.
While steel manufacturers have different specs for steel and pipe on offer, there are some broad categorizations to help users make informed decisions.
Firstly, all steel and pipe are alloys in which iron is mixed with carbon and other elements. Steels are therefore described as mild, me
edium- or high-carbon steels, depending on the percentage carbon they contain. The higher the carbon content, the harder the steel will be.
Metals such as nickel and chromium can also be added to produce alloy steels, for example stainless steel, which is used in high-end, quality steel products. Galvanized steel is coated with zinc to prevent corrosion, for example for the use of roof sheeting.
Galvanized pipe is also mainly used in construction, while corrugated steel pipes will be used more often for drainage, sewer and transportation. Seamless pipe, made from high-quality steel, is used for steam boilers and pipelines.
Steel products can be divided into two groups - flat and long products. Flat steel is used in the manufacture of cars, electrical products, sheeting, coils and pipes. Long products, on the other hand, are mainly used in construction.
Steel and pipe buyers will also come across the terms hot rolled and cold rolled steel. This refers to the heat treatment given during the production process, and has an impact on the qualities of the product. Cold rolled products are normally harder and more brittle, while hot rolled steel and pipe will be softer.
In addition to the different qualities of steel and seamless pipe products, they are also available in a wide variety of different sizes and thicknesses.
While steel manufacturers have different specs for steel and pipe on offer, there are some broad categorizations to help users make informed decisions.
Firstly, all steel and pipe are alloys in which iron is mixed with carbon and other elements. Steels are therefore described as mild, me
edium- or high-carbon steels, depending on the percentage carbon they contain. The higher the carbon content, the harder the steel will be.
Metals such as nickel and chromium can also be added to produce alloy steels, for example stainless steel, which is used in high-end, quality steel products. Galvanized steel is coated with zinc to prevent corrosion, for example for the use of roof sheeting.
Galvanized pipe is also mainly used in construction, while corrugated steel pipes will be used more often for drainage, sewer and transportation. Seamless pipe, made from high-quality steel, is used for steam boilers and pipelines.
Steel products can be divided into two groups - flat and long products. Flat steel is used in the manufacture of cars, electrical products, sheeting, coils and pipes. Long products, on the other hand, are mainly used in construction.
Steel and pipe buyers will also come across the terms hot rolled and cold rolled steel. This refers to the heat treatment given during the production process, and has an impact on the qualities of the product. Cold rolled products are normally harder and more brittle, while hot rolled steel and pipe will be softer.
In addition to the different qualities of steel and seamless pipe products, they are also available in a wide variety of different sizes and thicknesses.
Carlyle's $3.5bn steel deal falls through
In August, DBO Holdings Inc., the parent company of JMC, and NLMK entered into a merger agreement to sell DBO Holdings to NLMK for $3.53bn.
DBO Holdings filed a lawsuit on October 15th against NLMK in New York federal court regarding NLMK's failure to close the transaction in a timely manner, breaching the terms of the agreement.
Daniel A Pryor, Carlyle managing director and vice chairman of JMC, said, 'We are disappointed that NLMK has chosen to breach its obligations under the merger agreement. However, JMC is an exceptional company with superb employees and a proven management team. We see many opportunities to continue building and strengthening the business. It has been a privilege to work with the company over the past three years, and I look forward to continued involvement.'
JMC was formed as a result of a merger between John Maneely Company and Atlas Tube in 2006. It operates in five US states and one Canadian province, with a total production capacity of more than 3 million tons of steel pipe and tube per annum.
DBO Holdings filed a lawsuit on October 15th against NLMK in New York federal court regarding NLMK's failure to close the transaction in a timely manner, breaching the terms of the agreement.
Daniel A Pryor, Carlyle managing director and vice chairman of JMC, said, 'We are disappointed that NLMK has chosen to breach its obligations under the merger agreement. However, JMC is an exceptional company with superb employees and a proven management team. We see many opportunities to continue building and strengthening the business. It has been a privilege to work with the company over the past three years, and I look forward to continued involvement.'
JMC was formed as a result of a merger between John Maneely Company and Atlas Tube in 2006. It operates in five US states and one Canadian province, with a total production capacity of more than 3 million tons of steel pipe and tube per annum.
Fire razes steel pipe factory
MANILA, Philippines - Some P1 million worth of property went up in smoke after a fire broke out at a steel pipe factory in Taguig City Friday night.
Senior Fire Officer 1 Douglas Modomo said a fire broke at the Italit Develoment and Construction Corp. along Labao street in Barangay Napindan at around 11:30 p.m.
Modomo said the fire, which reached the third alarm, started at the chemical room located at the second floor of the building, owned by a certain Ramon Reyes.
The fire was put out an hour later, when some 14 firetrucks rushed to the scene. No one was reported injured in the incident.
Modomo said it was fortunate that the fire happened late at night when no worker was in the building. He added they are still conducting a follow-up investigation to determine what caused the fire.
Senior Fire Officer 1 Douglas Modomo said a fire broke at the Italit Develoment and Construction Corp. along Labao street in Barangay Napindan at around 11:30 p.m.
Modomo said the fire, which reached the third alarm, started at the chemical room located at the second floor of the building, owned by a certain Ramon Reyes.
The fire was put out an hour later, when some 14 firetrucks rushed to the scene. No one was reported injured in the incident.
Modomo said it was fortunate that the fire happened late at night when no worker was in the building. He added they are still conducting a follow-up investigation to determine what caused the fire.
Steel pipe tariffs forge optimism for V&M expansion in Youngstown
The U.S. International Trade Commission voted Wednesday to impose duties of between 10.36 percent and 15.78 percent on pipes used mostly in the oil and gas industries. President Obama still has to approve the ITC decision and determine the exact level of the tariff, Ryan said during a press conference Wednesday at the Youngstown Business Incubator.
The ITC decision resulted from a case filed by domestic producers, including V&M Star Steel and Wheatland Tube, which has several plants in the Mahoning and Shenango valleys, and by the United Steelworkers of American union.
"V&M has consistently said it would wait for this ruling before making a decision on its expansion," said Ryan.
Domestic producers testified before the ITC that the Chinese government has been subsidizing its pipe industry so that it can unfairly dump products in the U.S. market. Dumping is selling products for less than they cost to produce.
The pipe in question is called oil country tubular goods and is used in the extraction of oil and natural gas from wells. This type of pipe is a major part of the business for both V&M and Wheatland Tube.
Youngstown Mayor Jay Williams testified on behalf of the domestic producers. He said previously that China could unfairly take over too much of the domestic market and hurt V&M, which is considering whether to invest $1 billion to expand its Youngstown mill.
While V&M is apparently looking at other sites as well as Youngstown, the federal and state governments, Trumbull and Mahoning counties and Youngstown and Girard have cooperated together to persuade V&M to expand its plant here.
What an economic shot in the arm it would be for the Mahoning and Shenango Valleys, Ryan said, who added he does not know when V&M will make its decision.
William Kerins of Wheatland Tube said tube producers testified that Chinese imports of oil country tubular goods increased more than 200 percent from 2006 to 2008. Imports slowed this year once the trade case was filed, but plenty of inexpensive inventory remains in this country, he said.
The rise in Chinese imports has resulted in layoffs at Wheatland Tube, he said. About 100 of the company's 800 area workers are off the job, he said.
Enforcement of trade laws has already benefited Ohio workers.
In September, following a June ruling by the ITC on behalf of tire workers, President Obama announced that he would enforce "Section 421" trade safeguards that protect American manufacturers from excessive imports. After the ruling, Cooper Tire & Rubber Company announced plans to add capacity to its Findlay tire plant and hire up to 100 workers, Brown said.
Governor Strickland commended the ITC for its decision and for recognizing the need for relief for U.S. and Ohio businesses and workers from unfair trade practices.
"With our state's strong history of steel production, Ohioans and Ohio businesses deserve the chance to compete fairly and work to regain lost jobs in the steel industry," Strickland said.
All six ITC commissioners, three Democrats and three Republicans, agreed that imports of so-called oil country tubular goods from China have injured U.S. manufacturers.
The decision comes at a time when tensions between Western steelmakers and Chinese steelmakers are at a high point. It also follows a U.S. decision a day earlier to impose preliminary antidumping duties on imports of steel-grating products from China. The world's recession and overall drop in demand for steel products has caused steelmakers to fight for a smaller pool of customers, according to the Wall Street Journal.
Pittsburgh-based U.S. Steel Corp., and seven other producers, along with the United Steelworkers, filed a trade complaint in April against Chinese producers and exporters, claiming China's government was subsidizing pipe-production costs.
"China has been dumping products in the United States for years. This is just leveling the playing field," Ryan said.
Ryan said the ITC is sending a clear message that they will take significant steps against nations that dump their products in the U.S. Hopefully, over time, this will enable U.S. businesses to restore themselves, he said.
The ITC decision resulted from a case filed by domestic producers, including V&M Star Steel and Wheatland Tube, which has several plants in the Mahoning and Shenango valleys, and by the United Steelworkers of American union.
"V&M has consistently said it would wait for this ruling before making a decision on its expansion," said Ryan.
Domestic producers testified before the ITC that the Chinese government has been subsidizing its pipe industry so that it can unfairly dump products in the U.S. market. Dumping is selling products for less than they cost to produce.
The pipe in question is called oil country tubular goods and is used in the extraction of oil and natural gas from wells. This type of pipe is a major part of the business for both V&M and Wheatland Tube.
Youngstown Mayor Jay Williams testified on behalf of the domestic producers. He said previously that China could unfairly take over too much of the domestic market and hurt V&M, which is considering whether to invest $1 billion to expand its Youngstown mill.
While V&M is apparently looking at other sites as well as Youngstown, the federal and state governments, Trumbull and Mahoning counties and Youngstown and Girard have cooperated together to persuade V&M to expand its plant here.
What an economic shot in the arm it would be for the Mahoning and Shenango Valleys, Ryan said, who added he does not know when V&M will make its decision.
William Kerins of Wheatland Tube said tube producers testified that Chinese imports of oil country tubular goods increased more than 200 percent from 2006 to 2008. Imports slowed this year once the trade case was filed, but plenty of inexpensive inventory remains in this country, he said.
The rise in Chinese imports has resulted in layoffs at Wheatland Tube, he said. About 100 of the company's 800 area workers are off the job, he said.
Enforcement of trade laws has already benefited Ohio workers.
In September, following a June ruling by the ITC on behalf of tire workers, President Obama announced that he would enforce "Section 421" trade safeguards that protect American manufacturers from excessive imports. After the ruling, Cooper Tire & Rubber Company announced plans to add capacity to its Findlay tire plant and hire up to 100 workers, Brown said.
Governor Strickland commended the ITC for its decision and for recognizing the need for relief for U.S. and Ohio businesses and workers from unfair trade practices.
"With our state's strong history of steel production, Ohioans and Ohio businesses deserve the chance to compete fairly and work to regain lost jobs in the steel industry," Strickland said.
All six ITC commissioners, three Democrats and three Republicans, agreed that imports of so-called oil country tubular goods from China have injured U.S. manufacturers.
The decision comes at a time when tensions between Western steelmakers and Chinese steelmakers are at a high point. It also follows a U.S. decision a day earlier to impose preliminary antidumping duties on imports of steel-grating products from China. The world's recession and overall drop in demand for steel products has caused steelmakers to fight for a smaller pool of customers, according to the Wall Street Journal.
Pittsburgh-based U.S. Steel Corp., and seven other producers, along with the United Steelworkers, filed a trade complaint in April against Chinese producers and exporters, claiming China's government was subsidizing pipe-production costs.
"China has been dumping products in the United States for years. This is just leveling the playing field," Ryan said.
Ryan said the ITC is sending a clear message that they will take significant steps against nations that dump their products in the U.S. Hopefully, over time, this will enable U.S. businesses to restore themselves, he said.
China slams US steel pipe duties
The pipes, used for the transportation of oil and gas, will now be subject to duties of between 10 and 16 percent. Washington argues the measure is needed to counter China's unfair state subsidies.
In an online statement, Beijing's commerce ministry accuses the US of denying the genuine problems in the US steel industry, which it argues have nothing to do with China's policies but are caused by the global financial crisis and the shrinking demand for oil.
The trade dispute looks set to worsen trade relations between the US and China, which are already tense following a row over Chinese car tyres.
In an online statement, Beijing's commerce ministry accuses the US of denying the genuine problems in the US steel industry, which it argues have nothing to do with China's policies but are caused by the global financial crisis and the shrinking demand for oil.
The trade dispute looks set to worsen trade relations between the US and China, which are already tense following a row over Chinese car tyres.
Polish Stainless Steel Pipe
Stainless steel pipe doesn't look all shiny and new right off the welding line. In fact, it looks burnt and kind of charred. Polishing it will give it that mirror finish (or satin silver finish) that makes it such an attractive accessory.
Grind down any welds that are still on the pipe. Use a grinding disc and grinder for this task.
Mount the pipe into a pipe vise or similar set-up. If you don't have a professional pipe vise, you can use a regular vise wrapped with a towel or fitting with a rubber cap, but a professional vise is recommended. You will be applying a great deal of downward pressure to the pipe during the polish.
Apply a polishing compound to the pipe. Then slide your polishing belt (120 to 180 grit) onto the pipe and around the head of a grinder (fitted with a belt wheel sized to your pipe width). Hold this below the steel pipe and move it slowly back and forth across the pipe, sanding as you go.
Apply additional polishing compound as needed. Then continue to use the grinding belt wheel to polish the pipe by sliding it along the pipe with steady motions.
Apply polishing compound to the stainless steel pipe and buff the fine lines out with a buffer grinding disc.
Repeat until you have a stainless steel pipe polished to the finish you desire.
You can put several types of finishes on a stainless steel pipe. The smaller the grit of the belt sander, the finer the finish you will achieve. Different types of abrasive and non-abrasive buffing discs can also be used along with the belt grinder to achieve different types of finishes.
Grind down any welds that are still on the pipe. Use a grinding disc and grinder for this task.
Mount the pipe into a pipe vise or similar set-up. If you don't have a professional pipe vise, you can use a regular vise wrapped with a towel or fitting with a rubber cap, but a professional vise is recommended. You will be applying a great deal of downward pressure to the pipe during the polish.
Apply a polishing compound to the pipe. Then slide your polishing belt (120 to 180 grit) onto the pipe and around the head of a grinder (fitted with a belt wheel sized to your pipe width). Hold this below the steel pipe and move it slowly back and forth across the pipe, sanding as you go.
Apply additional polishing compound as needed. Then continue to use the grinding belt wheel to polish the pipe by sliding it along the pipe with steady motions.
Apply polishing compound to the stainless steel pipe and buff the fine lines out with a buffer grinding disc.
Repeat until you have a stainless steel pipe polished to the finish you desire.
You can put several types of finishes on a stainless steel pipe. The smaller the grit of the belt sander, the finer the finish you will achieve. Different types of abrasive and non-abrasive buffing discs can also be used along with the belt grinder to achieve different types of finishes.
EU Imposes Tariffs on Imports of Steel Pipe From China
Previously, complainants have had to prove the imports had already hurt their businesses. Trade lawyers say they expect a host of industries to ask the EU for protective tariffs in August.
The case also concerns one of the steel sector's most important finished products. Seamless steel pipes are major parts in housing construction, gas and oil plants and the automotive industry. The vote was close, according to EU officials familiar with the matter, although they declined to reveal the final tally.
After clearing procedural hurdles, the duties, which will range from 17.7% to 39.2%, are expected to take effect in October and last five years, EU officials said. Temporary duties of up to 24.2% have been in place since April.
Chinese officials say they are preparing a case at the World Trade Organization against the EU and the U.S. over steel tariffs. On Monday, the Chinese Ministry of Commerce issued a statement saying it was "gravely concerned" about antidumping duties on Chinese imports in the U.S. and the EU.
"If they impose the tax, that means we will lose the EU market," says Tan Ling, a manager for Hengyang Valin Steel Tube Co., which exports to the EU. The EU currently accounts for 5% to 10% of the company's sales, says Ms. Tan, who has been to Brussels several times to plead her case with EU officials. The company will try to compensate by exporting more to the Middle East and Africa, she says.
European consumers of Chinese steel imports also are upset at the new tariffs. "Consumers have to pay more because the market is protected," says Jan van Meever, the owner and CEO of Jan van Meever BV, a Dutch company that buys steel pipes from China and resells them in Europe. "It's just the way it is these days."
[Competitive Pressure]
Chinese exports have flooded the EU ever since China joined the WTO in 2001. Total shipments to the EU from China were $357 billion last year, up from $67 billion in 2000.
The EU's steel sector, a $250 billion-a-year business with 420,000 employees, has been vulnerable to imports because of Europe's high labor and environmental costs. Eurofer, the lobby group that represents European steelmakers, has lobbied hard for higher tariffs.
In the U.S. also, the steel industry has been on the front lines of demanding more protection from Chinese imports.
China came into Europe's seamless-pipe market only recently, its exports leaping to 552,368 tons last year from 35,000 tons in 2005. The surge came at the same time as EU imports of steel pipes from Russia and Ukraine were declining following the imposition of antidumping duties on imports from those countries in 2006.
More
* Moscow Targets Chinese Imports
* U.S. Steel Notes Brighter Outlook
But in those years the global economy was booming,The German export machine was firing on all cylinders, easily gobbling up the extra imports from China in 2007 and 2008. That made it difficult for European producers, when they filed their complaint in May 2008, to say they had been "injured" by dumped Chinese imports.
An import is considered to have been "dumped" when it is sold in a foreign market at or below cost to gain market share. Under WTO rules, the importing country may retaliate by applying "antidumping" duties. The country must demonstrate that goods have been dumped and that its companies have lost substantial sales as a direct consequence.
As the slowdown gathered steam last year, Europe's steel-pipe producers decided to try another tack. They argued that while they couldn't prove past losses, the threat of future injury, in an economic downturn, was so overwhelming that higher tariffs were essential.
"It is likely that low-priced imports will become even more attractive in a market which is increasingly seeking out cost reductions," the EU trade commission wrote in its final report.
Basing a claim on the threat of injury "is a perfectly legal strategy, but it has simply not, until now, been used as a matter of EU policy," says Nikolay Mizulin, a Brussels-based trade lawyer with Hogan & Hartson LLP. This case "is a sign of growing protectionism and could open the floodgates to many more industries who believe they deserve protection."
Mr. Mizulin and other trade lawyers say they expect many industries to seek protective tariffs next month.
The case also concerns one of the steel sector's most important finished products. Seamless steel pipes are major parts in housing construction, gas and oil plants and the automotive industry. The vote was close, according to EU officials familiar with the matter, although they declined to reveal the final tally.
After clearing procedural hurdles, the duties, which will range from 17.7% to 39.2%, are expected to take effect in October and last five years, EU officials said. Temporary duties of up to 24.2% have been in place since April.
Chinese officials say they are preparing a case at the World Trade Organization against the EU and the U.S. over steel tariffs. On Monday, the Chinese Ministry of Commerce issued a statement saying it was "gravely concerned" about antidumping duties on Chinese imports in the U.S. and the EU.
"If they impose the tax, that means we will lose the EU market," says Tan Ling, a manager for Hengyang Valin Steel Tube Co., which exports to the EU. The EU currently accounts for 5% to 10% of the company's sales, says Ms. Tan, who has been to Brussels several times to plead her case with EU officials. The company will try to compensate by exporting more to the Middle East and Africa, she says.
European consumers of Chinese steel imports also are upset at the new tariffs. "Consumers have to pay more because the market is protected," says Jan van Meever, the owner and CEO of Jan van Meever BV, a Dutch company that buys steel pipes from China and resells them in Europe. "It's just the way it is these days."
[Competitive Pressure]
Chinese exports have flooded the EU ever since China joined the WTO in 2001. Total shipments to the EU from China were $357 billion last year, up from $67 billion in 2000.
The EU's steel sector, a $250 billion-a-year business with 420,000 employees, has been vulnerable to imports because of Europe's high labor and environmental costs. Eurofer, the lobby group that represents European steelmakers, has lobbied hard for higher tariffs.
In the U.S. also, the steel industry has been on the front lines of demanding more protection from Chinese imports.
China came into Europe's seamless-pipe market only recently, its exports leaping to 552,368 tons last year from 35,000 tons in 2005. The surge came at the same time as EU imports of steel pipes from Russia and Ukraine were declining following the imposition of antidumping duties on imports from those countries in 2006.
More
* Moscow Targets Chinese Imports
* U.S. Steel Notes Brighter Outlook
But in those years the global economy was booming,The German export machine was firing on all cylinders, easily gobbling up the extra imports from China in 2007 and 2008. That made it difficult for European producers, when they filed their complaint in May 2008, to say they had been "injured" by dumped Chinese imports.
An import is considered to have been "dumped" when it is sold in a foreign market at or below cost to gain market share. Under WTO rules, the importing country may retaliate by applying "antidumping" duties. The country must demonstrate that goods have been dumped and that its companies have lost substantial sales as a direct consequence.
As the slowdown gathered steam last year, Europe's steel-pipe producers decided to try another tack. They argued that while they couldn't prove past losses, the threat of future injury, in an economic downturn, was so overwhelming that higher tariffs were essential.
"It is likely that low-priced imports will become even more attractive in a market which is increasingly seeking out cost reductions," the EU trade commission wrote in its final report.
Basing a claim on the threat of injury "is a perfectly legal strategy, but it has simply not, until now, been used as a matter of EU policy," says Nikolay Mizulin, a Brussels-based trade lawyer with Hogan & Hartson LLP. This case "is a sign of growing protectionism and could open the floodgates to many more industries who believe they deserve protection."
Mr. Mizulin and other trade lawyers say they expect many industries to seek protective tariffs next month.
China hits back at U.S. steel pipe decision
The Ministry of Commerce said it was "strongly dissatisfied with and resolutely opposed" to the vote of the U.S. International Trade Commission for countervailing duties, which Washington said were needed to balance out unfair state subsidies to Chinese makers of pipes for oil wells.
The global financial crisis and fall in demand for oil, not Chinese policies, were to blame for pressures on U.S. manufacturers, said a statement issued on the ministry's website (www.mofcom.gov.cn).
"U.S. domestic industry has been seeking opportunities to win trade relief and protection, and shifted the blame for its hardships onto imports," an unnamed ministry official said in the statement. "Finding that Chinese oil well pipes have damaged U.S. industry is a mistaken step that ignores the facts."
The ministry made no mention of any tit-for-tat moves against U.S. products, but these cannot be ruled out. It urged Washington to abandon the decision at a final vote on the anti-dumping case in May.
But a lawyer representing the United Steelworkers union and U.S. companies in the case earlier told Reuters that hearing is virtually certain to also approve separate anti-dumping duties on the pipes.
The ITC vote capped a year of U.S.-China trade friction likely to extend into 2010.
U.S. companies and unions brought about a dozen trade cases against China this year, alleging government subsidies and unfair pricing practices.
President Barack Obama also angered Beijing in September by slapping a 35 percent duty on imports of about $1.85 billion of Chinese-made tires in response to what the ITC said was a surge in imports that disrupted the market.
China, in response, accused the United States of protectionism, filed a complaint against the tires decision at the World Trade Organization and began a probe into whether U.S. autos are "dumped" in China at unfairly low prices.
The United States imported $2.74 billion of "oil country tubular goods" from China in 2008, more than triple the previous year, as rises in oil prices led to increased demand for the oil well tubing and casing.
The global financial crisis and fall in demand for oil, not Chinese policies, were to blame for pressures on U.S. manufacturers, said a statement issued on the ministry's website (www.mofcom.gov.cn).
"U.S. domestic industry has been seeking opportunities to win trade relief and protection, and shifted the blame for its hardships onto imports," an unnamed ministry official said in the statement. "Finding that Chinese oil well pipes have damaged U.S. industry is a mistaken step that ignores the facts."
The ministry made no mention of any tit-for-tat moves against U.S. products, but these cannot be ruled out. It urged Washington to abandon the decision at a final vote on the anti-dumping case in May.
But a lawyer representing the United Steelworkers union and U.S. companies in the case earlier told Reuters that hearing is virtually certain to also approve separate anti-dumping duties on the pipes.
The ITC vote capped a year of U.S.-China trade friction likely to extend into 2010.
U.S. companies and unions brought about a dozen trade cases against China this year, alleging government subsidies and unfair pricing practices.
President Barack Obama also angered Beijing in September by slapping a 35 percent duty on imports of about $1.85 billion of Chinese-made tires in response to what the ITC said was a surge in imports that disrupted the market.
China, in response, accused the United States of protectionism, filed a complaint against the tires decision at the World Trade Organization and began a probe into whether U.S. autos are "dumped" in China at unfairly low prices.
The United States imported $2.74 billion of "oil country tubular goods" from China in 2008, more than triple the previous year, as rises in oil prices led to increased demand for the oil well tubing and casing.
Steel-pipe maker seeks $239 million ahead of HK listing
Chu Kong Pipe seeks capital to expand its production. Meanwhile, China Oil and Gas tapped the market for $80 million last night through a top-up placement at a 16.7% discount.
Undeterred by the weakening sentiment for global equities, Chu Kong Petroleum and Natural Gas Steel Pipe Holdings kicked off an institutional roadshow yesterday for an initial public offering that seeks to raise between HK$1.35 billion and HK$1.85 billion ($174 million to $239 million).
Undeterred by the weakening sentiment for global equities, Chu Kong Petroleum and Natural Gas Steel Pipe Holdings kicked off an institutional roadshow yesterday for an initial public offering that seeks to raise between HK$1.35 billion and HK$1.85 billion ($174 million to $239 million).
China's seamless steel pipe price hike
China's seamless steel pipe price has increased again by about 300 yuan per ton.
Some traders worried that the price increased so much and quickly that the market could not accept the price increase. China's seamless pipe producers said they were forced to raise price due to soaring raw material cost.
Besides, Taiwan's seamless steel pipe buyers are holding from buying because of higher price.
Some traders worried that the price increased so much and quickly that the market could not accept the price increase. China's seamless pipe producers said they were forced to raise price due to soaring raw material cost.
Besides, Taiwan's seamless steel pipe buyers are holding from buying because of higher price.
4 mills results reflect growth of Chinese steel market in Q4 2009
Securities Times reported that five listed Chinese steel mills today announced their 2009 performance reports, indicating an upturn of profitability for steel industry in the fourth quarter of 2009.
The most typical among the five is Hunan Valin Steel Co Ltd which gave the market a surprise by amending its earlier prediction of a loss of CNY 220 million to an earning of CNY 100 million a decline of 89% from the previous year. The mill revealed that it is expected to make profit this year owing to the surging steel price in the last quarter of 2009 which was out of its expectation and the functional cost and expenditure control measures it has implemented.
According to the government of Hunan province by 2011, Valin Group steel capacity will reach about 20 million tonnes. Steel products will be 17.5 million tonnes and of them steel plate and pipe will account for over 70%. Sales revenue will hit CNY 118 billion and profit and tax, CNY 7 billion and CNY 10 billion by then.
Similarly, Guangzhou Iron and Steel Co Ltd having made profit in the first three quarters of last year is no doubt to bring home the bacon. The mill said the reason behind the satisfactory performance is the company's attempts to capitalize the market opportunities to expand capacity coordinate purchasing and promote marketing.
For Laiwu Iron and Steel Co Ltd its performance in 2009 was not so good enough to be celebrated which posted a decline of 50% compared with the previous year but there is no denying that it did turn red into black just in the last season, rubbing out its recorded deficit of CNY 170 million in Q1 to Q3 period.
The same is true of Benxi Steel Plate Co Ltd. It predicted to suffer a loss of CNY 1.32 billion to CNY 1.4 billion in the whole 2009, but there had been recorded a deficit of CNY 1.43 billion in the first three quarters of last year, meaning that in the last three months, it made profit.
As for Chongqin Iron and Steel Co Ltd it is hard to decide that it made profit in the last season of last year, because though it realized returns in the first three seasons it forecasted a year on year fall of over 80% from 2008.
The most typical among the five is Hunan Valin Steel Co Ltd which gave the market a surprise by amending its earlier prediction of a loss of CNY 220 million to an earning of CNY 100 million a decline of 89% from the previous year. The mill revealed that it is expected to make profit this year owing to the surging steel price in the last quarter of 2009 which was out of its expectation and the functional cost and expenditure control measures it has implemented.
According to the government of Hunan province by 2011, Valin Group steel capacity will reach about 20 million tonnes. Steel products will be 17.5 million tonnes and of them steel plate and pipe will account for over 70%. Sales revenue will hit CNY 118 billion and profit and tax, CNY 7 billion and CNY 10 billion by then.
Similarly, Guangzhou Iron and Steel Co Ltd having made profit in the first three quarters of last year is no doubt to bring home the bacon. The mill said the reason behind the satisfactory performance is the company's attempts to capitalize the market opportunities to expand capacity coordinate purchasing and promote marketing.
For Laiwu Iron and Steel Co Ltd its performance in 2009 was not so good enough to be celebrated which posted a decline of 50% compared with the previous year but there is no denying that it did turn red into black just in the last season, rubbing out its recorded deficit of CNY 170 million in Q1 to Q3 period.
The same is true of Benxi Steel Plate Co Ltd. It predicted to suffer a loss of CNY 1.32 billion to CNY 1.4 billion in the whole 2009, but there had been recorded a deficit of CNY 1.43 billion in the first three quarters of last year, meaning that in the last three months, it made profit.
As for Chongqin Iron and Steel Co Ltd it is hard to decide that it made profit in the last season of last year, because though it realized returns in the first three seasons it forecasted a year on year fall of over 80% from 2008.
Steel Pipe to increase 600,000 tons of steel pipe production annually
Chu Kong Steel Pipe may increase its production capacity by 600,000 tons in the future and steel price may not affect the company's costs.
Chen Chang, president from Chu Kong Steel Pipe introduced that 70% of company's funds was used for the construction of production line in the Lianyungang in Jiangsu Province. The production line was estimated to reach 300,000 tons of production annually. Chen pointed out that the company would expand capacity in the further and the new production line was expected to reach 600,000 tons. Meanwhile, the company would increase its market share through mergers and acquisitions selectively. Chen Zhaonian, executive director disclosed that the company planned to set up a joint venture with Middle East Company and establish a welded steel pipe production base in a bid to satisfy the larger demand in the local.
Chen Chang, president from Chu Kong Steel Pipe introduced that 70% of company's funds was used for the construction of production line in the Lianyungang in Jiangsu Province. The production line was estimated to reach 300,000 tons of production annually. Chen pointed out that the company would expand capacity in the further and the new production line was expected to reach 600,000 tons. Meanwhile, the company would increase its market share through mergers and acquisitions selectively. Chen Zhaonian, executive director disclosed that the company planned to set up a joint venture with Middle East Company and establish a welded steel pipe production base in a bid to satisfy the larger demand in the local.
Steel Market Analyses
Steel Market Analyses are an essential resource for steel trading, enabling you to:
Evaluate your current buy or sell offers for steel raw materials and steel products
Negotiate your current steel prices more effectively
Make more accurate estimations of future steel prices
Evaluate your current buy or sell offers for steel raw materials and steel products
Negotiate your current steel prices more effectively
Make more accurate estimations of future steel prices
Iranian steel pipe prices decrease
It is reported that because of the weak welded pipe market demand, some of Iran's local distributors have reduced their stock offer price by USD 15 per tonne to USD 45 per tonne.
However, Iran's tube & pipe producers have not been willing to reduce their offer price at this moment they believed their offer price is already the bottom.
Now, in Iran domestic market, the welded pipe price in January is the same as its price level in last December; the offer price of welded pipe of EN 10219 or DIN 2394 with OD 8" and thickness 2mm to 6mm is about USD 740 per tonne to USD 750 per tonne the price for same standard's square tube is also the same level.
Due to the raising raw material price in global steel market, Iran's pipe producers might have higher possibility to raise their price in the coming months but the weak domestic demand might show some impact on their decision.
However, Iran's tube & pipe producers have not been willing to reduce their offer price at this moment they believed their offer price is already the bottom.
Now, in Iran domestic market, the welded pipe price in January is the same as its price level in last December; the offer price of welded pipe of EN 10219 or DIN 2394 with OD 8" and thickness 2mm to 6mm is about USD 740 per tonne to USD 750 per tonne the price for same standard's square tube is also the same level.
Due to the raising raw material price in global steel market, Iran's pipe producers might have higher possibility to raise their price in the coming months but the weak domestic demand might show some impact on their decision.
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