MagForum 2017 analyses latest issues and spotlights potential newcomers and markets

Key takeaways

– China: supply impact issues to beset 2017-18; controversial trade reforms proposed

– New supply sources and capacities: Saudi Arabia (DBM+CCM), Australia, Canada

– Refractories: steady growth in steel demand; good cement outlook for certain regions

– Market opportunities in hydrometallurgy, flame retardants, environment, cement board,welding, and pulp and paper.

BRUSSELS — The European Union has set duties of up to 35.9 percent on imports of hot-rolled flat steel from China to counter what it says are unfair subsidies in a finding challenged by Beijing.

The European Commission (EC), which conducted an investigation on behalf of the 28 EU members, found a number of Chinese companies had benefited from preferential lending from state-owned banks, grants, tax deductions and the right to use industrial land.

«We are continuing to act, when necessary, against unfair trading conditions in the steel sector, and against foreign dumping,» EU Trade Commissioner Cecilia Malmstrom said in a statement. She added that she hoped global discussions on steel overcapacity would eventually convince China to end unfair schemes to ensure a level playing field for all steel producers.

China’s Commerce Ministry said it «strongly» questioned the legitimacy of the EU decision, adding the European Commission had ignored the fact China’s steel exports to Europe had declined in 2016. It said it would take all necessary measures to protect the interests of Chinese firms.

The EU had already set in place anti-dumping duties, to counter excessively low prices, which it has now adjusted to a range of between zero and 31.3 percent. «Today’s announcement marks a notable shift in the EC’s policy stance by taking into account the ‘threat of injury’,» investment bank Jefferies said in a note.

Jefferies said the case could have positive implications for imports of other types of steel, adding that it expected European steel industry group Eurofer to ask the Commission to launch more anti-subsidy investigations.

The bank noted that while Chinese hot rolled coil imports have fallen 89 percent in the year to March, and cold rolled coil imports, also protected by duties, have declined 46 percent, other product categories like coated sheet have soared. Hot-rolled flat steel is used in shipbuilding, gas containers, pressure vessels, tube and energy pipelines.

The targeted companies include Benxi Group [LNGOVB.UL], with overall anti-dumping and anti-subsidy duties of 28.1 percent, Hesteel Group, with a rate of 18.1 percent, and Jiangsu Shagang at 35.9 percent. The duties, applicable for five years, will take effect from Saturday, the EU’s official journal said.

The EU has taken over 40 anti-dumping decisions to aid European steel producers, with measures on cold-rolled flat steel and stainless steel from China. It also has an ongoing investigation into hot-rolled steel imports from Brazil, Iran, Russia, Serbia and Ukraine.

Chinese bauxite prices have jumped again in June, continuing the uptrend since May as the Chinese government ramps up efforts to stamp out polluting operations.

Chinese bauxite spot prices rocket higher in mid-June as the government targets remaining illegal calcining operations to further stamp out polluting facilities, which will slash yet more supply.

Mining operations in major bauxite-producing regions Shanxi and Guizhou were mostly suspended in May as the central government ramped up anti-pollution control. Under the newly enforced measures, calcining and processing plants in Shanxi and Tianjin were also affected.

Although the majority of plants that did not meet environmental standards were shut, some continued to operate illegally at night, two Europe-based traders told IM.

However, the Chinese environmental teams in Tianjin and Shanxi are continuing to undertake inspections in order to control pollution levels. Shanxi government announced on 15 June that it will carry out a special large-scale investigation on all operations in the province. The government has also encouraged locals to report any illegal operations.

«Some small unlicenced producers in Xingang, Tianjin, continue to produce during the night. The Government Environmental Team in Hebei and Tinjin have been tipped off by other suppliers that this continues to happen and the government is now focused on these suppliers and their customers,» one Europe-based distributor told IM.
As a result, many more plants are expected to shut down in the coming weeks, market sources said.

Amid heightening anti-pollution control, and the resulting suspension of production, bauxite stock levels are said to be depleting quickly, which has supported prices over the past two weeks.

Spot prices of 85% refractory-grade bauxite (85% Al2O3/2.0/3.15-3.2/0-6mm) rose to $380-390/tonne on an FOB Xingang basis, while 86% bauxite increased to $390-400/tonne, both grades gained $40 compared to a fortnight ago, according to IM’s assessment on 15 June.

Smaller volumes of 85% bauxite were reported to have traded at above $400/tonne in Europe and Asia, but these could not be verified at the time of publication.

87% bauxite held unchanged at $400-430/tonne, 15 June, while 88% was assessed at $430-470/tonne, up from $430-450/tonne previously, both on an FOB Xingang basis.

Founding is in metallurgical terms commonly meant to encompass the processes used in melting, purifying and casting metals and alloys including ferrous and non-ferrous products of all types and as such is still a very important market sector for both refractories suppliers and installers to satisfy.

En esta ocasión y con motivo del próximo curso de montadores, que se llevará a cabo, si todo procede según lo previsto en noviembre, la reunión de los comités fue conjunta, para poder tomar decisiones claves al respecto.

Carlos Briz y Roberto Caballero han tomado cargo de sus nuevos puestos, como Presidente y Vicepresidente de ANFRE respectivamente.

Queríamos agradecer a José María Domínguez, Presidente saliente, toda la dedicación que ha ofrecido a Anfre durante su mandato.

En la reunión de la Junta Directiva, como en ocasiones anteriores, se han tratado temas de suma importancia dentro del sector, tanto nuevos como temas anteriores que preocupan a los asociados.

Una vez finalizadas las reuniones hemos podido disfrutar de una comida en buena compañía ofrecida por Anfre.

Os esperamos a todos en Octubre!!!