Global Steel Prices Stabilise Amid Uncertain Outlook

The consensus view of global steel market participants is that they are uncertain about the future direction of domestic pricing.

At this time of year, US and European flat and long product prices would be expected to weaken, as market activity slows down, during the summer holiday period. The implementation of trade legislation has given US and European producers the opportunity to counter the traditional seasonal price trend.

In response to Section 232 tariffs, introduced in the United States, the European Commission recently announced provisional safeguarding measures on steel imports. The introduction of tariff rate quotas on 23 types of steel is aimed at preventing material, which has been redirected from the US, from entering the region.

MEPS’ research, in August, indicates that European steelmakers are already aiming to capitalise on the supply uncertainty, by raising their offers for fourth trimester business to EU customers. Firm demand and a lack of competitively priced imports should support their pricing initiatives.

In the United States, local selling values have been maintained at elevated levels, despite the reduction in demand, during the summer months. This is due to the high level of trade protection currently afforded to US steelmakers. The dearth of import competition, notably from neighbouring Canada and Mexico, has strengthened the selling position of local producers.

Subsequently, US and European steelmakers have, generally, been able to stave off the threat of losing, in the summer lull, a proportion of the pricing gains achieved in the first half of 2018.

Source: MEPS International Steel Review – August 2018

Successful Commissioning of SMS Group’s Fumes Treatment System at Uddeholm AB, Sweden

Successful Commissioning of SMS Group’s Fumes Treatment System at Uddeholm AB, Sweden

SMS group has successfully commissioned the second modernization phase of the fumes treatment system of the electric arc furnace, and final acceptance (FAC) has already been granted.

In phase 1, SMS group had installed a new, more efficient filter system and replaced the canopy hood of the electric arc furnace with an SMS frustum hood. In this connection, the secondary gas line was also renewed, and an axial cyclone was installed as spark separator upstream of the new jet pulse filter. In phase 2, the primary gas line for direct exhausting of the hot fumes from the 60-ton electric arc furnace was renewed.

The scope of supply of phase 2 consisted of a water-cooled fumes section, a gas cooler with bypass, and a radial-flow fan for pressure boosting. The hot fumes forming during the melting process are used to dry and preheat the scrap and adhering ice is removed this way. The installation of a cooler with bypass maintains the entry temperature at the scrap pre-dryer at maximum 300 °C, which prevents the formation of contaminants during scrap drying. The water-cooled components were optimized with regard to pressure losses and already prepared for the future use of an energy recovery system.

The modernization of the fumes treatment system yields quite a number of advantages. The new technology achieves a rise in fumes volume by 66 percent without increasing the energy consumption in comparison with the old system. The SMS frustum hood allows clearly more effective capturing and exhausting of the fumes during furnace charging and tapping. The dust content at the stack outlet is 50 percent below the requested value. The drying of the scrap guarantees safe operation of the furnace, and in the future it will be possible to recover energy by way of the extraction of hot water.

Source: SMS Group

 

Transfer bar cooling system from Primetals Technologies commissioned at Tata Steel Port Talbot hot strip mill

Transfer bar cooling system from Primetals Technologies commissioned at Tata Steel Port Talbot hot strip mill

Cooling system increases production capacity by approximately 150,000 metric tons of hot strip per year

Recently, a transfer bar cooling system supplied by Primetals Technologies was commissioned in the hot strip mill of Tata Steel´s Port Talbot integrated steel plant located in South Wales, United Kingdom. The purpose of the cooling system, installed after the roughing mill, is the precise control of the strip temperature before it enters the finishing mill, without having to slow down the roughing mill. This results in an increase of production capacity by approximately 150,000 metric tons of hot strip per year. The system is based on Primetals Technologies´ Power Cooling technology. The order to install the transfer bar cooling system was awarded to Primetals Technologies April 2017.

Transfer bar cooling system from Primetals Technologies installed at the hot strip mill of Tata Steel´s Port Talbot integrated steel plant located in  South Wales, United Kingdom.
Transfer bar cooling system from Primetals Technologies installed at the hot strip mill of Tata Steel´s Port Talbot integrated steel plant located in  South Wales, United Kingdom.

 

The Power Cooling technology from Primetals Technologies is especially designed to reach highest cooling rates. This technology can be implemented as intensive cooling between the roughing and the finishing mill area. This leads to improved strip temperature control for increasing productivity.

Tata Steel Port Talbot’s hot strip mill has a nominal capacity of about 3.4 million metric tons of steel per year. The Port Talbot site is an integrated blast furnace based steel complex, which produces slabs, hot rolled, cold rolled and galvanized coils. The transfer bar cooling system installed after the roughing mill exit table employs a total of 18 spray headers in its initial configuration, nine top and nine bottom headers, and may be extended with additional headers at a later time. The total length of the transfer bar cooling system is approximately 10 meters. In order to cope with a large variety of steel grades and process requirements, especially the minimum surface temperature of the bar during cooling, the flow rates of the Power Cooling headers are adjustable over a wide range, so that a lower cooling intensity is also achievable as required for each individual product. Each header is flow-controlled by a separate ball segment valve.

Transfer bar cooling is based on Primetals Technologies´ Power Cooling

In addition to the transfer bar cooling system itself, Primetals Technologies´ scope of supply encompassed the affected roller table, including motors, drives and transformers, an overhead tank, a booster pump station and a cross-spray pump station. Level 1 and level 2 automation as well as the interface to the existing hot strip mill automation system was also provided.

The transfer bar cooling technology was tested for the first time at voestalpine Stahl in Linz, Austria in 2003. The first industrial installation was set up at Thyssen Krupp Bruckhausen in Germany in 2013.

Source: Primetals Technologies

EU Steel Buyers Grapple with Safeguard Implications

EU Steel Buyers Grapple with Safeguard Implications

The European Commission announced provisional safeguarding measures on imports of steel, prior to the start of the European summer holiday period. This created uncertainty at a time when many domestic mills are closed for several weeks, across July and August. Limited order volumes are usually placed, at this time. However, MEPS predicts higher than normal market activity across the industry, this month.

The provisional import quota system is designed to restrict the impact of steel being diverted into the EU market as a result of the Section 232 measures, introduced in the United States. Any steel brought into the European region, over and above specified tonnages, will incur a 25 percent tariff rate. The European Commission believes that this will protect the local steel industry from serious harm. The quotas are set for a period of 200 days from July 19 and have been calculated, on a pro-rata basis, from the average of the tonnages imported in the years 2015, 2016 and 2017.

The European Commission has excluded five steel categories from the provisional quotas and tariffs – stainless steel quarto plate, grain oriented electrical steel, non-alloy and other alloy cold finished bars, railway material and other seamless tubes. However, these products may be included when the definitive measures are decided. The Commission will continue to monitor the import volumes for these products. Conclusive measures are likely to be determined in December 2018 and will supersede the July announcement. A number of exclusions have been made for the 122 developing nations, albeit with exceptions for some steel categories in each country. These were determined if their previous import volumes exceeded 3 percent of total imports for each specified product.

MEPS notes uncertainty surrounding how the quotas will operate. Many buyers worry about whether foreign steel, ordered now, will be subject to the 25 percent tariff when the material is delivered to the port. A customer will not know if the quota will still be available, at the time of ordering the material.

An electronic monitoring system will be used to manage the quotas. The allocation will be made on the second working day following customs acceptance, in chronological order of the date of customs declaration. Consequently, material booked from overseas cannot be guaranteed to be tariff free until after it has arrived, been accepted at customs and allocated, under the relevant quota, by the Commission.

Concerns are being raised that exports from the EU to the US would reduce, because of the Section 232 tariffs, resulting in material being diverted back into the European market. However, this has yet to be realised. The large disparity between US and EU steel prices, at present, enables steel to continue to be sold into the United States, with the tariffs included. MEPS is forecasting a downward domestic price correction, in the US, in the autumn of this year. Despite this, exports, to the country, are likely to remain viable, in the near term, particularly for flat steel products.

Imports of steel into the EU were rising prior to the Section 232 announcements. It is feasible to conclude that volumes from third country sources would have continued to increase, with or without the US trade barriers. The European Commission’s safeguarding measures are expected to bring this growth in foreign material to a halt and could result in a reduction in imports, as European traders reduce purchases, for fear of falling foul of the tariffs by the time the steel arrives. This may restrict the buying options available in the market and give local producers increased pricing power.

European steel price increases are now forecast to extend into the autumn, with the MEPS EU average hot rolled coil transaction value likely to hit an almost seven-and-a-half-year high, in the coming months. Consequently, profits at the domestic steelmakers are expected to remain healthy, for the remainder of this year.

The upward price effects of the EU safeguarding actions are likely to be limited. The quotas are not designed to reduce foreign supplies but to restrict excessive growth in steel imports, which may result from the redirection of material due to the US Section 232 tariffs. Overseas material is an important source of supply for the EU market.

A degree of competition from third country suppliers will remain in the EU steel market. This may be tempered by tariff concerns. Nevertheless, if domestic mills were to push too hard for price increases, then imports, including any tariff costs, would become attractive to many EU buyers. The result of this would be a loss of market share for the local producers.

European domestic steel prices are forecast to weaken, marginally, towards the end of 2018. A negative trend in transaction values is anticipated throughout most of 2019. Declining raw material costs, coupled with reduced home and overseas demand, is predicted, next year. Nevertheless, a modest pickup in steel selling figures is possible, in the first quarter of 2019.

Source: MEPS European Steel Review

EU Safeguarding Measures Influence Stainless Steel Purchasing Behaviour

JSW ORDERS HIGH-SPEED BILLET CASTER FROM SMS CONCAST

JSW Steel Ltd. in Toranagallu, India, belonging to Jindal Group, has awarded SMS Concast, a company of SMS group, an order covering a 5(6)-strand high-speed billet caster. This project is part of a bigger expansion plan, and the main objective is a productivity increase.

The existing steel plant consists of a 160-ton electric arc furnace, ladle furnace, billet caster and rolling mill and shall increase the annual production to 1,500,000 tons of steel after installation of the new billet caster. The caster will be designed for fast casting of square billets with an edge length of 165 millimeters.

SMS Concast’s caster configuration will allow the common use of spares in two different steel meltshops. This is one big feature to decrease OPEX.

Furthermore, latest technology will be applied to reach the specified productivity and OPEX targets. One special product is the low- maintenance oscillation drive called CONDRIVE, another the advanced INVEX® mold technology.

The CONDRIVE mold oscillation represents a totally new approach combining the advantages of hydraulic and mechanic drives in one. Due to the innovative torque drive, the amplitude, frequency and oscillation profile can be adjusted online and independently. Thus it grants full functionality, however without the hydraulic system drawbacks in terms of maintenance and piping. In this context, CONDRIVE is one part of the advanced maintenance concept with a view to reduced spare parts inventory.

Regarding productivity, the SMS Concast-developed INVEX® mold allows for very high strand throughputs in the area of 790 kg/min. The special tube geometry and enhanced water cooling features allow the mold to achieve efficient heat transfer and thus a more uniform solidification at the faces and in the corner areas, thus enabling higher casting speeds.

“Considering the very good performance of the existing SMS Concast equipment, its advanced technology and reduced OPEX, we have decided to go for another co-operation in order to implement our expansion plan,” says Mr. Purushottam Prasad from JSW Steel Ltd.

SMS group is a group of companies internationally active in plant construction and mechanical engineering for the steel and nonferrous metals industry. It has some 14,000 employees who generate worldwide sales of about EUR 3 billion. The sole owner of the holding company SMS GmbH is the Familie Weiss Foundation.

Source: SMS Group

EU Safeguarding Measures Influence Stainless Steel Purchasing Behaviour

EU Safeguarding Measures Influence Stainless Steel Purchasing Behaviour

EU Safeguarding MeasuresThe EU’s recently announced temporary quotas and tariffs on steel imports, arising from the Commission’s safeguarding investigation, might have been expected to push prices of stainless steel upward, in the European market. However, some buyers have chosen to expand their placement of import orders, in the short term, to maximise their own intake of low priced material, before quotas are exhausted. This has the effect of reducing demand for locally produced material and, thereby, places downward pressure on prices.

This should be short-lived. Many stainless steel buyers are wary that, given the long delivery lead times on orders from, for example, the Far East, material ordered now could arrive in Europe after the appropriate quota has been filled and, therefore, incur tariff charges. Consequently, they are more likely to source their requirements from European mills – in turn, applying inflationary pressure, in the regional market.

Source: MEPS – Stainless Steel Review

Mixed Trend in EU Flat Product Steel Prices in July

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