28 January 2022 – Overcapacity: While China produced significantly less in 2021, EU27 and India are fighting for the top position in crude steel production increase and overcapacity. Base metals defy the strong dollar and Italian pipe producers raise prices for February 2022.
Base metals take off today despite strong dollar
Despite a stronger US dollar, base metals on the LME started this morning with gains for the most part. Nickel and aluminium in particular, but also zinc, continued to rise, in some cases by more than 1%.
A glance at Asia shows that base metals have also picked up there. Aluminium, zinc and HRC futures in particular are up by more than 2% on the SHFE, and Chinese stainless steel prices also remain firm. Iron ore futures on the DCE are up more than 7.5% today and coking coal is also up almost 4%.
Italian pipe producers raise prices
It is reported from Italy that the local manufacturers of welded pipes have raised their prices for February 2022. The background is the significant pick-up in demand and rising local Italian and international prices for steel and stainless steel.
Steel overcapacity: World Crude Steel Production 2021
According to the currently published figures of the worldsteel association, approx. 3.7% more crude steel was produced worldwide in 2021. After Chinese steel producers had mostly led in production in previous years, they produced 3% less in 2021 than in the previous year. The frontrunners in crude steel production in 2021 are the EU27 countries with over 20.4 million tonnes and India with an increase of about 18 million tonnes.
With that, just before the weekend, we allow ourselves the somewhat provocative question: “Which market should now be protected from which overcapacity?“
Announcement: Chinese New Year/ Lunar New Year 2022
There will be less news from Asia in the coming days, as the Chinese New Year (Lunar New Year) is being celebrated there. Should there be interesting and important news to report from there in the meantime, we will of course inform you here immediately.
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Disclaimer: Many things here represent our opinion. Others are information from the Internet. We can therefore never claim to be correct or complete. And never base a business decision solely on the news you receive from us.