AISI: Climate Change Provisions
Must Apply to All Steelmakers
Emphasizing the American steel industry’s global environmental leadership in recycling and carbon emissions reduction, American Iron and Steel Institute President and CEO Andrew G. Sharkey, III, told congressional leaders last month that any climate change provisions developed must apply to foreign firms selling in the U.S. market or the consequences will be dire for the U.S. economy and the environment.

Sharkey testified before the Senate Committee on Environment and Public Works during a legislative hearing of America’s Climate Security Act of 2007.

“The domestic industry is the most energy efficient in the world. Largely through recycling and investments in new technology, it has reduced energy use per ton of steel shipped by over 40 percent in the past 25 years,” said Sharkey of the Washington, D.C.-based AISI. “Reductions in carbon emissions per ton of steel shipped between 1990 and 2006 exceeded 29 percent.”

“However,” he added, “if climate change legislation fails to address the competitiveness issues vis-à-vis foreign products, it will have devastating consequences not only for the U.S. economy, but also for the environment. Not only will we export American jobs, greenhouse gas emissions will rise.”

AISI and its member companies, domestic steel producers, believe that any competitiveness provision should: apply simultaneously to domestic and foreign firms selling in the U.S. market; use the same baseline periods; not invite subsidies by foreign governments; and not enable the administration to waive the requirements on foreign manufacturers.

Seeking further environmental gains, Sharkey said, the U.S. steel industry has embarked on aggressive research and development programs to develop the next generation of iron and steelmaking technologies that could drastically reduce or eliminate CO2 emissions.

Climate change legislation would have a sizable impact on U.S. workers and manufacturers if it is not approached in global terms. For instance, since the year 2000, the United States has lost 3.5 million jobs, Sharkey claimed. This is a statistic that will only grow if steel production and other manufacturing industries are encouraged to leave this market in favor of markets with lower environmental standards, such as China, he said. This will not only result in jobs and production moving offshore, but will actually result in higher volumes of greenhouse gas emissions worldwide.

Sharkey concluded that AISI and the domestic steel industry want to work with the committee to find reasonable and effective policies. It is through this collaboration that the U.S. will be able to find prudent means of addressing climate change while allowing the U.S. manufacturing base to remain viable and globally competitive.

MSCI
Steel Shipments Inch Up
for First Time in 2007
Although steel shipments rose slightly from year-ago levels for the first time since August 2006, steel product inventories at U.S. service centers continued to decline in October, reaching levels that are at or near their cyclical lows, according to the latest Metals Activity Report from the Metals Service Center Institute, Rolling Meadows, Ill.

U.S. aluminum shipments continued to sag as inventories of the metal reached their lowest level in five years. In Canada, October shipments and inventories of both steel and aluminum products continued to decline from year-earlier levels.

Steel product activity
Shipments of steel products from U.S. service centers totaled 4.7 million tons in October, up 1.7 percent from October 2006, but off 2.3 percent on a seasonally adjusted basis. Steel product inventories at the end of October totaled nearly 12.26 million tons, 27 percent below year-ago levels and the lowest since March 1998, when inventories totaled 12.25 million tons. At October shipping rates, U.S. steel inventories represented a very low 2.6-month supply.

In Canada, service centers shipped 331,700 tons of steel during October, or 1.7 percent below year-ago shipments (down 6.6 percent on a seasonally adjusted basis).

Month-end steel inventories totaled 1.1 million tons, 19.7 percent below October 2006 supplies. At October shipping rates, Canadian steel inventories were sufficient for 3.3 months.

Aluminum product activity
Shipments of aluminum products from U.S. service centers totaled 102,100 tons, or 3.9 percent below October 2006 shipments (down 7.9 percent on a seasonally adjusted basis). Month-end aluminum inventories totaled 271,500 tons, down 30.8 percent from a year ago and at the lowest level since June 2002, when aluminum stockpiles totaled 261,000 tons. The inventory total was sufficient, at October shipping rates, for 2.7 months.

Canadian service centers shipped 10,500 tons of aluminum products during October, down 0.7 percent from a year ago (down 4.8 percent seasonally adjusted).

Their aluminum inventories totaled 27,800 tons, 15.6 percent below last year’s total. At October shipping rates, Canadian inventories were sufficient for 2.7 months of sales.

AISI
September Shipments Down vs. 2006, August
U.S. shipments of steel declined in September compared to both the previous month and the same month in 2006, according to the latest data from the American Iron and Steel Institute, Washington, D.C. U.S. steel mills shipped 8.5 million net tons, a 7.7 percent decrease from the 9.2 million tons shipped in September 2006 and a 7.8 percent decrease from the 9.2 million net tons shipped in the previous month, August 2007.

A comparison of year-to-date shipments shows the following changes within major market classifications: service centers and distributors, down 11.6 percent from 2006; automotive, down 1.0 percent; construction and contractors’ products, down 2.9 percent; and oil and gas, down 8.5 percent.

AISI also reported an increase in steel import permit applications during October. Permit applications totaled 2.6 million tons, an increase of 8 percent from the 2.4 million tons recorded in September and a 19 percent increase from the preliminary import totals of 2.2 million tons.

AIIS
Semifinished Imports Surge in September
Total steel imports increased 13 percent in October on a rise in semifinished imports and three more working days compared to the previous month, according to the American Institute of International Steel, Washington, D.C., which represents foreign mills. Imports of slabs used by the domestic industry to augment their melting capacity increased 116 percent compared to September, or by 423,000 tons. While total imports increased 312,000, finished imports declined for the month. 

“This massive increase in steel imports [by domestic mills] reflects the domestic industry’s expectations of improving market conditions and coincides with their price increase announcements,” says David Phelps, AIIS president. “On the other hand, the decline in finished imports shows that higher prices in many other international markets, along with record high ocean freight rates, leaves the U.S. a challenging market to import non-NAFTA steel into at this time.” 

Total steel imports in October were 2.7 million tons compared to 2.39 million tons in September, a 13.1 percent increase, but a 30.4 percent decrease compared to October 2006. According to year-to-date figures, imports decreased 25.7 percent compared to 2006, or from 38.8 million tons in 2006 to 28.8 million tons in 2007.

The data show that imported semifinished products decreased by 0.3 percent in October 2007 compared to October 2006. For the year-to-date period, semifinished imports decreased from 8.16 million tons in 2006 to 5.85 million tons in 2007, a 28.2 percent decrease.

SSINA
Stainless Imports Up Through Eight Months
Imports of stainless steel through eight months of 2007 totaled 550,872 tons, a 2 percent increase compared to the first two-thirds of 2006, according to data from the Specialty Steel Industry of North America, Washington, D.C.

U.S. consumption was 1,545,626 tons, an 11 percent decrease compared to the previous year. Eight-month import penetration was 36 percent, a 5 percent increase.

IISI
North American Steel Production Climbs
World crude steel production for the 67 countries reporting to the Brussels-based International Iron and Steel Institute was 114.0 million metric tons in October. This is a 6.6 percent increase vs. October 2006.

World production totaled over 1.1 billion tons for the first 10 months of 2007, an increase of 8.1 percent over the same period of 2006. This marks the fourth year in a row that world steel production has broken the billion-ton mark.

For the first month this year, U.S. steel production exceeded its figure from the previous year, with 8.5 million tons in October, 4.9 percent more than the 8.1 million tons in October 2006. Production in Canada of 1.4 million tons (up 7.4 percent) and Mexico’s 1.5 million tons (up 3.6 percent) were also above October 2006 numbers. North American production for the month totaled 11.5 million tons, 5.3 percent above the 10.9 million in the same month one year earlier.

Chinese production was 42.9 million tons in October, an increase of 13.5 percent vs. October 2006. Japanese production was 10.4 million tons, an increase of 2.7 percent. Other major producers in the region were South Korea (4.3 million tons, up 8.5 percent) and India (4.6 million tons, up 8.8 percent).

The major European steel producing countries in October were Germany (4.2 million tons, down 1.1 percent compared to October 2006), Italy (2.9 million tons, down 2.0 percent), Spain (1.6 million tons, down 1.8 percent), France (1.4 million tons, down 12.5 percent), and the United Kingdom (1.1 million tons, down 6.4 percent). Total EU-27 production for October was 17.6 million tons, a decrease of 2.2 percent compared to October 2006.

Production in Turkey was 2.2 million tons, an increase of 6.8 percent compared to the same month last year. Russia produced 6.2 million tons, an increase of 5.5 percent compared to October 2006. Production in Ukraine was 3.6 million tons, an increase of 3.6 percent.