WEAK MARKET FUNDAMENTALS KEEP STAINLESS STEEL PRICES IN CHECK

Stainless steel market activity remains subdued, around the world. Prices are quite stable. Transaction values, particularly for grade 304 material, edged upwards, in some countries, this month, as a result of the increase in LME nickel figures between April and May. Most European producers’ alloy surcharges, for type 316 products, were reduced in June, as molybdenum costs maintained their downward trend.

Consumption is sluggish, in all regions. On the positive side, car makers continue to record strong sales, while there are signs of increased building and construction activity in many developed countries. Meanwhile, the persistently low oil price has led to severely reduced investment in exploration projects. Sales volumes to the general manufacturing sector are yet to show any indication of the recovery that has been anticipated for some time. Speculators are cautious, especially in Europe, as they await some resolution of the Greek debt crisis.

Nevertheless, we have seen some small signs of encouragement. Basis values for coil products are too low to be sustainable, in the long term. Consequently, European producers have made clear their requirement for better returns on material for delivery after the summer vacation period. We have reports of some increases being agreed by buyers, already, and there are indications of further advances in the near future.

The medium-term outlook for nickel pricing is a matter on which market observers are not universally agreed. Many had predicted that, driven by the impact of the Indonesian ore export ban, global supply would slip into deficit by the middle of 2015. The prospect of this situation was expected to have an inflationary effect on nickel values.

In fact, a combination of weaker than anticipated demand and the utilisation of alternative raw material sources, by Chinese nickel pig iron producers, kept supply in surplus. As a result, commodity prices for the metal have been on a downward curve since the beginning of the year.

Nonetheless, miners and market analysts alike believe that most of the factors required for a supply deficit are falling into place. Consequently, nickel values are forecast to increase, steadily, over the coming twelve months.

Source: MEPS – Stainless Steel Review – June Issue

Outokumpu completes the ramp down of the Bochum melt shop

OUTOKUMPU OYJ
PRESS RELEASE
June 23, 2015 at 4.00 pm EET

Outokumpu announced today that the Bochum melt shop ramp down in Germany has been completed. The last melt was marked with a ceremony honoring the over 100 years of stainless steel operations in Bochum that now ended.

Said Outokumpu Senior Vice President Coil EMEA – Business Line Nirosta Oliver Picht: “Today is naturally a sad occasion, marking the end of an era of stainless steel production in Bochum, but a necessary measure to balance our production capacity in Europe. I would like to express my gratitude to the entire Bochum staff for their work and commitment, especially over the last two years. For us it was extremely important to find good, alternative employment and solutions for all employees, so that no one had to be made redundant.”

The ramp down of the Bochum melt shop and the closure of Krefeld melt shop in 2013 were both key elements in the significant industrial restructuring and achieving the synergies following the merger of Outokumpu and Inoxum. Furthermore, it is fundamental to the turnaround of Coil EMEA. The positive financial impact of Bochum melt shop ramp down are more than 30 million annually from 2016 onwards and around 20 million euro of savings visible already in the second half of 2015.The  Bochum closure is part of the EMEA restructuring program in Europe that targets 100 million euro savings by the end of 2017.

Outokumpu continues its strong presence in Germany, with around 2,500 employees, a high class cold rolling center in Krefeld that produces premium tailored materials for the most demanding end-customer segments, as well as cold rolling and finishing plants in Benrath, Dahlerbrück and Dillenburg. Outokumpu is investing more than a 100 million euro into the cold rolling operations in Krefeld to enhance its ferritic capabilities and enable the planned closure of the Benrath site in 2016. Additionally, further investments will be made into the R&D center in Krefeld.

Source: Outokumpu Group

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TOSYALI HOLDING TO BUILD WORLD’S LARGEST DRI COMBO PLANT

June 22, 2015 (Charlotte, NC – USA)   Tosyali Holding has awarded Midrex Technologies, Inc. and its partner Paul Wurth S.A. the project to build the world’s largest multiple product direct reduced iron plant for Tosyali Algeria located in Bethioua (Oran), Algeria.

The new MIDREX NG™ Direct Reduction Plant Combo will be designed to produce 2.5 million tons of DRI and have the capability to vary its production to produce hot direct reduced iron (HDRI) and/or cold direct reduced iron (CDRI) simultaneously without stoppage of production. This new DRI plant will be the largest single DRI plant to produce multiple DRI products in combination.  HDRI will be fed via an Aumund hot transport conveyor to a new EAF meltshop located adjacent to the MIDREX® DRI Plant allowing for greater EAF productivity and energy savings; CDRI can also be produced for additional onsite use.  The new Tosyali Algeria MIDREX® DRI Combo Plant will provide the Tosyali Algeria steelmaking facility with greater production flexibility to produce high quality, low impurity steels as well as decrease their demand for imported scrap.

Benefits of Hot Direct Reduced Iron
There are two main benefits of charging hot DRI (HDRI) to the EAF: lower specific electricity consumption and increased productivity. The energy savings occur because less energy is required in the EAF to heat the DRI to melting temperature, resulting in a shorter overall melting cycle.Additional benefits of charging hot DRI (HDRI) to the EAF are:

Less energy required to heat the DRI to melting temperature.
Shorter overall melting cycle
Reduced electrode consumption
Reduced tap-to-tap time up to 20% compared to charging DRI at ambient temperature.
Reduced electricity consumption about 20 kWh/t liquid steel for each 100° C increase in DRI charging temperature.
Lower overall emissions due to lower electricity demand and reduced need for charge carbon

The history of Tosyalı Holding goes back to 1952. Iskenderun’s first holding, Tosyalı Holding, began a rapid period of growth in the 1980’s. Tosyalı Holding has 16 facilities throughout Turkey with 6 in the Osmaniye Organized Industry Zone (OIZ), 1 in Istanbul, 1 in Izmir, 7 in the Iskenderun OIZ and 1 in the investment stage. Also the company has 2 facilities in the North African country of Algeria and 1 in Europe’s Montenegro. Tosyalı Holding has a total of 18 facilities on 3 continents in 6 different regions along with 12 affiliates. Under the Tosyalı Holding umbrella there are the 3 production companies Tosçelik Profil ve Sac Endüstrisi A.Ş. , Tosyalı Demir Çelik Sanayi A.Ş. and Tosçelik Granül San. A.Ş., which are all leaders in their own sectors, and Tosyalı Dış Ticaret A.Ş., which conducts the foreign trade operations.

Source: Paul Wurth

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NORDIC STEEL MARKET ROUNDUP FROM MEPS

Market conditions are relatively steady across the Nordic region, according to MEPS. The volume of enquiries and orders, for hot rolled coil, has begun to reduce as the summer holiday season approaches. Supply chain participants do not expect any major changes in market conditions during the third quarter.

Commodity plate consumption is fair. Manufacturing has shown signs of recovery but the construction sector remains weak. Competition between suppliers has been increased by imports from Russia.

Demand for cold rolled coil is largely stable. Delivery lead times are now stretching beyond the summer break. Nevertheless, the producers have been unable to increase selling values, as yet.

Drawing quality wire rod demand is satisfactory, albeit slightly below historical levels. Supply chain participants expect activity, during the next three months, to continue at a similar level. Consumption of structural sections is fair. Delivery lead times are quite long, the mills are sold out until the summer holidays.

There is some upward pressure on rebar prices from higher scrap costs. Consumption is fair. However, imports from Russia and Belarus are plentiful. In Sweden, sales volumes to infrastructure and civil engineering projects are good.

Merchant bar market activity is steady and is expected to continue at the same level after the summer break. Sellers in Finland report some improvement in demand from the manufacturing sector. Meanwhile, in Norway, consumption from OEMs is steady at a mediocre level.

Source: European Steel Review Supplement – June Edition

IMPORT THREAT KEEPS MEPS BENCHMARK EU AVERAGE STEEL PRICE FLAT – MEPS INTERNATIONAL LTD

Overall, demand for flat products is reasonable in Western Europe. Buyers are anticipating the arrival of large quantities of third country material during the summer, particularly at ports in the south. Following concerns about the increasing impact of imports on the EU steel market, the European Commission has initiated an antidumping investigation into cold rolled coil imports from China and Russia. Negotiations have started between the domestic mills and the auto companies for second half 2015 contracts. Producers would like a rollover of the first half prices but the carmakers are expected to ask for lower values because the steelmakers’ input costs are down.

Demand is holding up in Germany with business in the first six months described as acceptable, with auto leading the way. Forecasts suggest that building activity may be down slightly in the second half. Buyers are receiving new offers from third country sources but many consider the price benefits to be too small when compared to the long delivery lead times. However, they are aware that large volumes are already on the way. There is plenty of material quickly available from domestic sources.

Activity on the French market is still weak in major consuming sectors, such as construction and energy, whereas the auto industry is faring satisfactorily. Competition between distributors is fierce. As a result, a number of warehouses have closed down. Ex-mill basis values have remained relatively stable since last month. There is some pressure from overseas suppliers, which has left domestic producers struggling to maintain selling figures. Import quantities have climbed since the start of the year.

Although internal demand remains depressed in Italy, there are small signs of recovery, mainly in the auto sector, so far. Domestic basis values have deteriorated further, driven down by poor sales, high levels of availability and increasingly aggressive offers from China and India. Considerable volumes have been booked for arrival during the summer holidays. As a result, buyers do not expect prices to recover during 2015. Competition in the distribution sector is severe, with service centres so hungry for business that they concede discounts on a daily basis.

Consumption is said to be reasonable in the UK, with the manufacturing sector fairly busy. Service centre sales have been healthy. Stocks are well balanced with demand. Producers are willing to be flexible during negotiations and prices are down, a little. Resale values have declined in tandem with the ex-mill figures.

Belgian service centres are keeping inventories low because they can obtain material quickly from local mills, who, in some instances, are carrying stock. End-users are only purchasing what they need for immediate use. Imports are available from China and Russia.

Underlying consumption is slowly improving in Spain, where domestic basis numbers are unchanged from May. However, the market is slow. The summer vacation period is approaching and large quantities of pre-booked, foreign material are still to arrive.

Source: MEPS – European Steel Review – June Issue

Primetals Technologies modernizes wire-rod mill in Turkey for Kroman

  • Upgrade to improve product quality for entry into new markets
  • Latest laying head technology incorporates durable SR Series pipe
  • Cooling conveyor modified with Optimesh technology

Turkish steel producer Kroman Çelìk Sanayìì A.Ş has contracted with Primetals Technologies to apply advanced technology to a wire rod outlet built in 2008 to expand its product line with high carbon wire rod. Signed last year, the contract calls for 13-month delivery of equipment, with erection and commissioning expected to be completed by the end of this summer.

In this regard, Kroman’s new #2 mill includes a Morgan Intelligent Pinch Roll and the latest laying head technology with SR Series self-regenerating pipe, designed for longer pipe life. In addition, the contract calls for modifications to the existing cooling conveyor with the incorporation of Optimesh technology and upgrades to the reform tub and ring distributor. The new equipment has a guaranteed speed of 110 m/s.

Founded in 1967, Kroman is based in Darıa-Kocaelì, Turkey. With two steel shops, two wire rod mills, a rolling profile and a bar rolling mill, it produces more than 1.3 million tons of crude steel annually.

Source: Primetals.com

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