Recap 2016 – Steel raw materials shined through the year
Exclusive
02 January 2017
Steel making raw materials like coking coal, coke, scrap and iron ore have been the show stoppers through 2016 impacting the steel prices from time to time inspite of constrained demand.
Miners took advantage of the stable demand by slowing down mining and productivity and artificially raising their prices. Major miner Vale was stuck in domestic problems further allowing Australian iron ore miners to step up their offers.
Iron ore prices started 2016 at $43 per tonne CFR China for 62% Fe fines and ended the year at $79 per tonne with an average price of the year at $58 per tonne. Previous year (2015) the average price was $56 per tonne. Highest level recorded in 2016 was $84 and lowest at $39 per tonne as compared to $72 per tonne highest in 2015 and $38 per tonne lowest in 2015.
Similarly, coking coal (Peaks Down) CFR India price for 2016 averaged at $153 per tonne while the highest level recorded was $322 per tonne and lowest at $79 per tonne. The raw material closed the year at $240 per tonne as compared to last year’s closing at $83 per tonne. In 2015, the average price of coking coal was $97 per tonne.
The extreme surge in the coking coal prices was due to a result of closure of mines in China to reduce pollution and the advantage was taken by coal miners in Australia and South Africa, hence punishing the Indian steel makers and spiking the steel prices across the globe.
Coming to HRC and rebar prices in China through 2016, the average price of HRC (FOB China) for exports was $377 per tonne and $337 per tonne for rebar. Previous year HRC averaged at $302 per tonne and rebar at $277 per ton respectively. Highest level recorded in HRC through 2016 was $520 per tonne while the lowest was $270 per tonne. Similarly, highest level recorded in rebar through 2016 was $446 per tonne while the lowest was $247 per tonne respectively. At the year closing HRC was trading at $498 per tonne while rebar was at $420 per tonne respectively.
The impact of the coking coal and steel prices in China was seen on the Turkey’s scrap with a slight delay through the year. HMS 1&2 (80:20) CFR Turkey scrap closed at $292 per ton on 31st December 2016 with a year high of $330 per tonne and year low at $173 per tonne. The average price through the year was $235 per tonne which was $5 per tonne lower to the average of 2015.
| 2016 Year
Low |
v/s 2015 Low | 2016 Year
High |
v/s 2015 High | 2016 Year
Avg |
v/s 2015 Avg | 2016
1st Jan |
2016
31st Dec |
2016
Change |
||
| Met. Coke
CFR India (62% CSR) |
115 |
-6% |
356 |
78% |
202 |
29% |
122 | 306 | 151% | |
| Coking Coal
CFR India (Peak Downs) |
79 |
-1% |
322 |
164% |
153 |
58% |
83 | 240 | 189% | |
| Coking Coal
FOB Aus (Peak Downs) |
74 |
-1% |
312 |
181% |
144 |
64% |
77 | 232 | 201% | |
| HRC
FOB China |
270 |
-5% |
520 |
17% |
377 |
25% |
270 | 498 | 84% | |
| Rebar
FOB China |
247 |
-1% |
446 |
15% |
337 |
22% |
247 | 420 | 70% | |
| Iron ore
CFR China (62% Fe) |
39 |
-3% |
84 |
17% |
58 |
4%
|
43 | 79 | 84% | |
| Iron ore
Dom. China (Conc. 66%) |
64 |
– |
105 |
1% |
84 |
-6% |
65 | 103 | 58% | |
| Scrap
CFR Turkey 1&2 (80:20) |
173 |
-2% |
330 |
3%
|
235 |
-2% |
185 | 292 | 58% |
(All prices in USD per tonne)
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