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Commodity News

Ferrous – The World Steel Association reported last week that global crude steel production during Jan-Feb 2019 rose 3.8% Y-o-Y to 287.6 million metric tons as Chinese steel production increased 9.2% year-on-year to 149.6 million mt during Jan-Feb.

Of note, worldsteel also reports U.S. steel production was up 6.9% year-on-year during Jan-Feb '19 to 14.4 million mt while Turkish steel output declined 16.1% during the corresponding period to 5.2 million metric tons.

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For the week ending March 23, 2019, the American Iron and Steel Institute reports “domestic raw steel production was 1,934,000 net tons while the capability utilization rate was 83.1 percent. Production was 1,826,000 net tons in the week ending March 23, 2018 while the capability utilization then was 78.3 percent. The current week production represents a 5.9 percent increase from the same period in the previous year. Production for the week ending March 23, 2019 is up 0.2 percent from the previous week ending March 16, 2019 when production was 1,930,000 net tons and the rate of capability utilization was 82.9 percent.

Nonferrous –

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The International Aluminium Institute estimates primary aluminum production came in at 4.92 million metric tons in February, down 9 percent from January but up 0.26% from one year ago. IAI estimates that China produced 2.78 million tons of primary aluminum in February following Chinese aluminum production restrictions during the winter and weaker than expected demand from the automotive industry. Meanwhile, LME 3-mo. aluminum prices reportedly traded as high as $1,925 per ton on Friday as LME 3-mo. copper prices approached $6,500 per ton.

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Paper and Plastic – Indonesia recently announced that all scrap paper imports will return to 100% inspections on container loading as of April 1, 2019. Indonesia became an important alternative market for scrap paper and plastics exports after the Chinese government implemented their Blue Sky initiative that severely restricted import volumes of these products to China. U.S. exports of recovered paper to Indonesia nearly doubled from 2017 to 2018. Most of the volume increases were in corrugated grades and mixed paper.

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For plastics, Indonesia has also benefited from the focus on quality and there’s been a marked increase in their demand for U.S. PET plastics.

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On the domestic side, New York is expected to pass a state budget bill which includes provisions to ban single-use plastic bags, primarily for grocery and food service purposes, and permit local governments to opt into a fee program for paper bags. For more information, please contact ReMA Research Analyst Bernie Lee.


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