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November 19, 2021 – After an accident at a large Chinese aluminium smelter in Yunnan province, aluminium prices jumped today by more than 3% in some cases. EU HRC prices are stable and are expected to rise further from January 2022. German group Thyssenkrupp is thinking aloud about outsourcing its steel division and forecasts a significant increase in demand for 2022.

Stainless Espresso: Aluminium smelter accident - prices jump due to shortage concerns
Stainless Espresso: Aluminium smelter accident – prices jump due to shortage concerns

China: Aluminium smelter accident – prices jump due to shortage concerns

According to media reports, an explosion and subsequent fire occurred at an aluminium smelter in the Chinese province of Yunnan on Thursday, 18 November 2021. According to initial reports, no one was injured and the extent of the damage to the aluminium smelter, which produces 300,000 MT per year, is still unknown.

SHFE aluminium prices jumped

Aluminium prices on the SHFE and the LME have already reacted to the aluminium smelter accident. On the SHFE, aluminium is up by more than 3%, on the LME futures are currently up by more than 2%. In addition, there is currently stronger demand due to positive market trends.

Nickel prices rise by more than 4%

Nickel prices on the Asian SHFE rose by more than 4% in some cases in today’s trading. On the European LME, nickel futures have also risen by more than 2.5%. The background here is an increase in demand in China and scarce availability at Jinchuan Nickel. In addition, many stocks at nickel processors have fallen significantly.

European hot-rolled coil prices stable

European hot-rolled coil (HRC) prices are currently stable and are expected to remain so until the end of 2021. However, EU steelmakers seem to be planning for HRC price increases in January 2022, as higher raw material costs and increasing demand from end-users, especially the automotive industry, are expected due to the decreasing shortage of semiconductors.

Thyssenkrupp plans to spin off steel division

After the sale of the thyssenkrupp steel division failed several times, the group now seems to plan the outsourcing. According to the group, it is currently considering under which circumstances the steel division could be transformed into an independent company. However, details are not expected before spring 2022.

Stable spot market and strong increase in demand in 2022

Thyssenkrupp also currently sees a stable spot market and expects a strong increase in demand in 2022, especially from the automotive sector.

Opinion: A spin-off of the steel division from the parent company thyssenkrupp could, in our opinion, lead to more consistency in steel prices.

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