2007 Association News

International Trade Commission Revokes
15 of 17 Countervailing Duty Orders
The U.S. International Trade Commission has revoked all but two countervailing and antidumping duties against foreign steel producers during recent sunset review hearings. Sixteen countries were involved in two separate reviews.
Orders were revoked against all countries in sunset reviews on cut-to-length plate: Belgium, Brazil, Finland, Germany, Mexico, Poland, Romania, Spain, Sweden, Taiwan, and the United Kingdom.

The American Institute for International Steel applauded the decision of the ITC to sunset 15 of 17 cases under review. “AIIS believes that the newly restructured steel industry, with strong profits and healthy demand, does not need protection from import competition that these 13-year-old cases provided. We believe that it is a big win for steel consumers and the U.S. economy in general,” says David Phelps, president of AIIS, a trade organization representing foreign steel interests.

In a separate hearing on corrosion-resistant carbon steel flat products, orders were lifted on products from Australia, Canada, France and Japan, but upheld against Germany and Korea.

“The ITC vote, while helping U.S. consuming industries by removing significant restrictions and restoring greater competition, cannot conceal the flaws in U.S. trade remedy laws, which do not even consider the impact of imposing or continuing these measures on the U.S. economy,” says Steve Alexander, president of the Consuming Industries Trade Action Coalition.

The American Iron and Steel Institute, a vocal advocate for government action against unfair imports, declined to comment on the latest ITC actions. AISI has members in both Canada and the United States.

MSCI: Steel Shipments, Inventories
Decline in November
Consistent with slow demand indicative of a correspondingly weaker economy, inventories of steel and aluminum at North American service centers declined in November, according to the Metals Activity Report from the Metals Service Center Institute, Rolling Meadows, Ill.

Because service center shipments so closely parallel the broader manufacturing economy, the November results indicate a weaker undertone to metals-related economic activity. They also provide further evidence that industrial metals inventories may have passed their cyclical peak, say MSCI officials.

Steel inventories at U.S. service centers registered their first monthly decline since November 2005, when the current cycle’s inventory building phase began. Aluminum inventories at U.S. service centers fell for the first time since March 2006. Aluminum and steel inventories continued to decline at Canadian service centers.

November steel shipments from U.S. service centers totaled 4.33 million tons, down 3.3 percent from the same month in 2005. Shipments for the first 11 months of the year of 52.5 million tons were 3.3 percent higher than the same period the previous year. Steel inventories at the end of November were 16.6 million tons, down 1.0 percent from October, but 33.0 percent higher than a year earlier. At the November shipping rate, steel inventories represented a 3.8-month supply, 5.7 percent higher than October 2006 and an increase of 37.7 percent from 2005.

Aluminum shipments during November totaled 94,100 tons, down 0.1 percent from the previous year. Year-to-date shipments of 1.13 million tons were up 3.2 percent from a year ago. Aluminum inventories at the end of November totaled 388,200 tons, down 1.1 percent from October, but 10.7 percent larger than a year earlier. At the November shipping rate, service centers had enough aluminum on hand to last 4.1 months, an increase of 10.9 percent from 2005 and 11.7 percent from last month.

Steel shipments from Canadian service centers totaled 322,400 tons, down 14.2 percent from November 2005. For the year to date, steel shipments of 3.73 million tons were down 4.2 percent from 2005 period. Steel inventories of 1.29 million tons were down 6.4 percent from last month, but were 31 percent higher than November 2005. At the November shipping rate, Canadian steel inventories represented a 4.0-month supply, a decrease of 2.1 percent from last month, but 52.6 percent greater than 2005.

Canadian service centers shipped 10,200 tons of aluminum products in November, up just 0.1 percent from November 2005. Year-to-date shipments total 116,200 tons of aluminum or 3.5 percent more than the same period the previous year.

Aluminum inventories totaled 30,800 tons at the end of November, a 6.5 percent decrease from a year ago and a decrease of 6.7 percent from the previous month. At the November shipping rate, this represented a supply sufficient for 3.0 months, down 6.5 percent from last year and a decrease of 2.9 percent from October.

CBSA: Copper Shipments Still Up,
But Slowing at Year’s End
Red metals distributors reported that shipments of copper and copper alloy products declined nearly 8 percent in November compared to October 2006, according to the Copper and Brass Servicenter Association, Wayne, Pa.

Part of the monthly decrease was the result of one fewer shipping day in November. The average daily shipping rate declined 3.5 percent.

But the results were more disappointing compared to the companion month of 2005. Total shipments and the average daily shipping rate from November 2006 compared to the previous year both declined 9.0 percent, with alloy products off even more sharply at 11.9 percent.

Nevertheless, for the first 11 months of the year, copper shipments remained 8.5 percent ahead of the similar period a year ago, while alloy shipments held on to a gain of 2.8 percent. Total shipments, after 11 months, were up 4.9 percent for the year.

AISI: Steel Imports On Pace
to Set New for Record
The United States imported 3,389,000 net tons of steel in November 2006, down 13 percent from October, according to the American Iron and Steel Institute, Washington, D.C. Steel imports remained well ahead of the previous year’s pace, up 45 percent from 2005 and on pace for a record year.

The story was the same for finished steel, which was down 10 percent compared to October, but remained 46 percent ahead in a year-to-date comparison with 2005.

On an annualized basis, based on 2006 imports through November, total and finished steel imports— at 46.0 and 36.5 million net tons, respectively—would set all-time records, easily surpassing the previous record of 41.5 and 34.7 million net tons set in 1998.

Key products registering large increases in November compared to the previous month include pipe for piling, up 527 percent; rails standard, up 84 percent; hot-rolled bars, up 14 percent; structural pipe and tubing, up 14 percent; and hot-rolled strip, up 13 percent.

The rise in year-to-date 2006 imports compared to the previous year remains pronounced for countries with a history of unfair trading charges, especially in Asia, say AISI officials. They include Taiwan, up 213 percent; Thailand, up 164 percent; China, up 135 percent; India, up 95 percent; and South Korea, up 60 percent. In November, for the fifth month in a row, China was the single largest source of steel imports to the United States at 521,000 net tons. Imports from China were 274 percent higher in November 2006 than in the same month in 2005, and at their present pace will exceed 5 million tons for 2006.

“While imports were down slightly in November, the real story here looking at the year-to-date totals is that steel imports are on a pace to reach over 46 million net tons, setting an all-time record level far outreaching the previous record of 41.5 million net tons set in 1998,” says AISI President and CEO Andrew G. Sharkey, III. “We also see the same disturbing pattern with year-to-date steel imports from Asian nations up 100 percent, led by China. This trend underscores the need for the NAFTA governments to more aggressively press China to abandon its currency manipulation, export subsidies, trade barriers and other anticompetitive practices that deny North American steel producers a level playing field.”

SSINA: Stainless Imports Remain
Ahead of 2005 Pace
Imports of total stainless steel in the first nine months of 2006 totaled 602,881 tons, a 17 percent increase compared to the same 2005 period, according to the Specialty Steel Industry of North America, Washington, D.C. U.S. consumption was 1,947,562 tons, a 13 percent increase, while import penetration was 31 percent, up 1 percent.

SSINA reports the following data comparing year-to-date imports and consumption through September 2006 vs. the same nine-month period in 2005:

Stainless steel sheet/strip: Imports were 386,744 tons, a 35 percent increase; U.S. consumption was 1,408,693 tons, a 14 percent increase.
Stainless steel plate: Imports were 74,294 tons, a 16 percent increase; U.S. consumption was 254,575 tons, a 31 percent increase.
Stainless steel bar: Imports were 84,302 tons, a 12 percent decrease; U.S. consumption was 170,020 tons, an 8 percent decrease.
Stainless steel rod: Imports were 21,735 tons, a 36 percent decrease; U.S. consumption was 49,447 tons, a 7 percent decrease.
Stainless steel wire: Imports were 35,806 tons, an 8 percent increase; U.S. consumption was 64,825 tons, a 12 percent increase.

Imports of total specialty steel (comprising stainless steel, alloy tool steel and electrical steel) in the first nine months of 2006 were 731,496 tons, a 9 percent increase compared to the same 2005 period; U.S. consumption was 2,334,668 tons, an 11 percent increase.

Alloy tool steel: Imports were 76,453 tons, a 16 percent decrease; U.S. consumption was not calculable.
Electrical steel: Imports were 52,162 tons, a 21 percent decrease; U.S. consumption was 329,302 tons, a 7 percent increase.

IISI: Asia Spurs Higher Steel Output
World crude steel production for the 62 countries reporting to the International Iron and Steel Institute, Brussels, Belgium, totaled 104.2 million metric tons in November, 10.3 percent higher than for the same month of 2005.

Crude steel production in North America was estimated at 10.2 million tons in November, 2.2 percent lower than the same month in 2005.

Asia is still the largest steel producing area with total production of 589.2 million tons for the first 11 months of the year. This is 12.5 percent higher than for the corresponding period of 2005. In November, China produced 38.0 million tons of crude steel, an increase of 24.1 percent compared to the same month in 2005. Crude steel production in India was 3.8 million tons, an increase of 10.1 percent year-on-year.

South Korea produced 4.1 million tons in November, a rise of 0.7 percent. Japan produced 10.0 million tons of crude steel, 9.5 percent higher than a year earlier.

Production in the EU was 16.3 million tons in November. This is 5.9 percent higher than for the same month in 2005. Germany produced 3.9 million tons of crude steel in November, an increase of 9.2 percent year-on-year. Italy produced 2.8 million tons, up 8.2 percent from the previous year. Crude steel production declined in both France (-1.1 percent) and the United Kingdom (-7.1 percent).

Brazil produced 2.7 million tons of crude steel in November, an increase of 2.6 percent from 2005.

Total South American crude steel production was 3.9 million tons in November, an increase of 1.8 percent from the previous year.

ISSF: World Stainless Production
Jumps 30% in Third Quarter
World stainless crude steel production in the third quarter of 2006 rose by 30.4 percent to 7.1 million metric tons compared to the third quarter of 2005. Total production for the first nine months of 2006 was 20.9 million tons, an increase of 13.0 percent compared to the same period of 2005, according to the International Stainless Steel Forum, Brussels, Belgium.

The sharp increase in stainless steel production occurred in all stainless steel producing regions. ISSF believes the increase indicates a well-performing world economy. Many northern hemisphere producers reduced their normal summer break periods in response to heavy demand. Producers and fabricators are also still refilling stocks that were depleted by the large production cuts in late 2005.

The largest stainless producing area is Asia with production of 10.9 million tons of stainless steel in the first nine months of 2006. This is 14.7 percent higher than for the same period of 2005. The main contributor again was China with a total increase of more than 50 percent compared to the first nine months of 2005. China is by far the largest stainless steel producing country in the world.