📌Russian authorities push an increase in scrap export duty to EUR 290/t from May, up from current minimum level of EUR 100/t
• It is now up for government approval
• However, the measure is not to be applied to the fixed quota of 810-830kt/a
❗️Given historical volume of scrap exports of 3.2mnt/a, this will create significant surplus on domestic market and ease cost pressure for steelmakers.
• It is now up for government approval
• However, the measure is not to be applied to the fixed quota of 810-830kt/a
❗️Given historical volume of scrap exports of 3.2mnt/a, this will create significant surplus on domestic market and ease cost pressure for steelmakers.
⛏Brazil’s CSN plans to double its iron ore output capacity up to 70mnt/a by 2026
• CSN also expects to reach an iron ore capacity of 116mnt/a by 2036
• 2036 plan implies increase in global seaborne supply by 5% from current level
💰At spot CSN is trading at 2.3x EV/EBITDA and 30% FCFE yield. If doubles production multiples will drop to 1.7x EV/EBITDA and FCF yield is to grow to 37%
• CSN also expects to reach an iron ore capacity of 116mnt/a by 2036
• 2036 plan implies increase in global seaborne supply by 5% from current level
💰At spot CSN is trading at 2.3x EV/EBITDA and 30% FCFE yield. If doubles production multiples will drop to 1.7x EV/EBITDA and FCF yield is to grow to 37%
⛏Vale plans to increase its copper production to 450kt/a by 2027 (up 52% from the 2021 level)
• 2027 plan implies increase in global supply by 0.7% from current level
💰At spot Vale is trading at 3x EV/EBITDA and 13% FCF yield. If copper production reaches 450kt/a multiples will drop to 2.9x EV/EBITDA and FCF yield is to grow to 18%
• 2027 plan implies increase in global supply by 0.7% from current level
💰At spot Vale is trading at 3x EV/EBITDA and 13% FCF yield. If copper production reaches 450kt/a multiples will drop to 2.9x EV/EBITDA and FCF yield is to grow to 18%
📌Secondary market rough diamond prices declined 10-40% in recent weeks
• Prices of large stones fell 10%, while the prices of smaller diamond categories decreased 40%
❗️In the last few months, secondary market prices rose more significantly than the contract prices of Alrosa and De Beers, which led to the secondary market price correction.
• Prices of large stones fell 10%, while the prices of smaller diamond categories decreased 40%
❗️In the last few months, secondary market prices rose more significantly than the contract prices of Alrosa and De Beers, which led to the secondary market price correction.
⛏ArcelorMittal partially suspended operations at some of its steel mills in Spain
• This was caused by lack of raw materials supplies on the back of truck drivers protests
• The affected steel mills produce about 2% of EU crude steel output
• Previously, the company had already reduced output at some of its EAFs in Spain due to rising energy costs
❗️This might support EU steel prices, especially given that further steel output reductions are possible
• This was caused by lack of raw materials supplies on the back of truck drivers protests
• The affected steel mills produce about 2% of EU crude steel output
• Previously, the company had already reduced output at some of its EAFs in Spain due to rising energy costs
❗️This might support EU steel prices, especially given that further steel output reductions are possible
📌 China’s National Coal Association (CNCA) expects the country's 2022 coal production to increase moderately
• However, CNCA did not provide any exact estimates
• In 2021, China’s authorities approved new coal capacity of 300mnt/a (8% of annual production)
❗️This, coupled with China’s coal price regulations might pressure coal prices
• However, CNCA did not provide any exact estimates
• In 2021, China’s authorities approved new coal capacity of 300mnt/a (8% of annual production)
❗️This, coupled with China’s coal price regulations might pressure coal prices
📌Why will Russian steelmakers quickly restore capacity utilization to 100%?
❗️Russian steelmakers are in the top 10% of the most efficient producers: their integrated cash costs are at USD 230-380/t, which is 2x lower than the global average and 3x lower than in the US or Europe.
• At the same time, steel prices reached USD 895/t in China (HRC FOB) and USD 1,600/t in Europe (EU HRC). Even with increased delivery costs, exports of steel will remain profitable for Russian steel producers
📝Even during the global financial crisis in 2009, when global steel production fell by 8% YoY, Russian steelmakers restored their capacity utilization up to 100% in just two quarters
#steel #rusteel
❗️Russian steelmakers are in the top 10% of the most efficient producers: their integrated cash costs are at USD 230-380/t, which is 2x lower than the global average and 3x lower than in the US or Europe.
• At the same time, steel prices reached USD 895/t in China (HRC FOB) and USD 1,600/t in Europe (EU HRC). Even with increased delivery costs, exports of steel will remain profitable for Russian steel producers
📝Even during the global financial crisis in 2009, when global steel production fell by 8% YoY, Russian steelmakers restored their capacity utilization up to 100% in just two quarters
#steel #rusteel
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📌 The COVID-19 lockdown in the major steelmaking city of Tangshan, China was lifted on 31 March
• Previously, some steel mills in Tangshan had idled their BFs due to shortages of raw materials caused by the lockdown
❗️This might support China's steel supply and pressure steel prices
📝Tangshan accounts for 14% of China's steel output
#steel #China #COVID_19
• Previously, some steel mills in Tangshan had idled their BFs due to shortages of raw materials caused by the lockdown
❗️This might support China's steel supply and pressure steel prices
📝Tangshan accounts for 14% of China's steel output
#steel #China #COVID_19