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Stainless Espresso: Already 85% of Chinese truck drivers in quarantine?
Stainless Espresso: Already 85% of Chinese truck drivers in quarantine?

26 January 2022 – We are receiving reports from China that 85% of all truck drivers in the Ningbo area are stuck in Corona quarantine. In addition, stocks of Chinese steel are running low in Tangshan due to strong demand and cut production. In the EU, steel stocks need to be replenished due to high demand. And aluminium prices near October 2021 highs due to concerns about sanctions against Russia. Stock markets and metals are positive ahead of today’s US Federal Reserve meeting.

China: 85% of truck drivers in quarantine?

Due to quarantine measures in China’s Ningbo Area, 85% of the truck drivers available there are now said to be unavailable, as truck drivers have to go directly into quarantine if they change province. This is what market sources tell us. This has also caused the transport costs for trucks to skyrocket. Due to the Chinese government’s 0-Covid strategy and the requirement that the Winter Olympics take place at all costs, further measures could be expected here.

Tangshan restricts steel production

On 23 January, the Chinese city of Tangshan declared an orange alert due to air pollution and restricted steel production. Stocks of steel slabs in Tangshan have fallen to just 135,000 MT as of January 2022, according to the latest figures. This represents a drop of more than 30% compared to December 2021.

CISA: Chinese steel output falls 15% by mid-January

According to a CISA report, daily pig iron and crude steel production in China fell by about 15% in January.

Chinese steel prices pick up due to strong demand

Chinese steel prices have risen in the past week due to increased global demand. Iron ore prices have also been on the rise since November 2021. Here, Chinese spot prices have risen by over 38%.

EU: Steel stocks need to be replenished

Due to the improved weather situation, increased demand from the automotive sector and empty stocks at wholesalers, steel prices in the European Union are expected to rise further. Especially in the construction sector, demand for steel and stainless steel is likely to increase in the coming weeks, as warmer weather always triggers increased construction activity.

Aluminium: Fear of Russia sanctions drives up prices

Aluminium prices have risen in recent days and weeks, after the light metal had already been sung the death knell several times. Currently, aluminium on the LME is only a few dollars away from its historic high from October 2021. In addition, there are now also concerns about possible sanctions against Russia due to the smouldering unrest regarding a possible conflict with Ukraine. Russia is one of the world’s largest aluminium producers and Nato countries have announced strong sanctions should Russia attack Ukraine.

Positive trends before Fed meeting

The markets are friendly and strong this morning. The German DAX has already gained more than 1.7%. The MDAX by more than 2.0%. Nickel is already up more than 1.68% on the LME. Copper and zinc are also up more than 1.2%. Oil and natural gas prices have risen. All in all, this points to good sentiment ahead of the Federal Reserve meeting today, Wednesday, and a possible interest rate hike by the US central bank.

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