Tuesday, February 28, 2006
Unions representing hourly workers at Tower Automotive Inc. are likely to strike the Novi-based auto-parts supplier in two weeks to show resolve for higher-stakes showdowns at Delphi Corp. and General Motors Corp., one auto analyst predicts.
Tower, a global supplier of vehicle frames and components for every major auto manufacturer, asked a bankruptcy judge Monday to cancel its union contracts. That would allow Tower to cut $40 million a year in hourly wages and benefits.
On Jan. 30, Tower's three unions [...] approved a strike and said they would strike if Tower nullifies union contracts.
Brian Johnson, an analyst with Sanford C. Bernstein, said he does not believe Tower will reach an agreement with its unions.
'We believe that the key unions are likely to follow through on strike threats in order to send a signal to GM and Delphi that if they choose to use bankruptcy to get rid of contracts, they may strike,' Johnson said. 'But the strike may prove to be short-lived.'
Monday, February 27, 2006
Copper may fall this week after the Grasberg mine in Indonesia, the world's second biggest for copper, resumed operations following the end of a three-day blockade, easing concern about a shortage of the metal.
Six of 11 traders, analysts and investors polled by Bloomberg on Feb. 23-24 said copper will be little changed and four said it will drop. One forecast a gain.
Operations were stopped at Grasberg on Feb. 22 after villagers demanding to be allowed to sift through ore in the company's waste piles blocked a road leading to the site. The blockade was lifted at 6 p.m. Jakarta time Feb. 25, Freeport spokesman Siddharta Moersjid said in a telephone interview.
``Workers have returned and started the evening shift,'' Moersjid said. ``The blockade was opened voluntarily, and the protesters have given their demands to Freeport and the local administration. We will continue discussing their demands.''
Thursday, February 23, 2006
The chief executive of AK Steel Holding Corp. is taking his case for worker concessions directly to their homes as the contract between the company and the employees nears expiration.
Some 3,500 videotapes were distributed Tuesday and Wednesday to hourly and salaried employees, with a message from James Wainscott, the Middletown company's chairman, chief executive and president.
'When a steel company goes down, the town goes down and everybody loses,' Wainscott says in the 19-minute video, titled 'Decision in Middletown.'
The contract expires next Tuesday. Members of the Armco Employees Independent Federation, which represents more than 2,600 workers at AK's Middletown Works, voted last weekend to authorize a strike if necessary. Negotiations are continuing.
Wednesday, February 22, 2006
Copper rose for a fifth consecutive trading session in London as output was halted at Indonesia's Grasberg, the world's second-largest copper mine.
Grasberg produced 660,000 metric tons of copper in 2005, about 4 percent of global output. Some analysts previously forecast usage will beat output in 2006.
``This is at a time when the copper market can ill afford to lose production,'' John Meyer, a London-based analyst at Numis Securities, said today in an e-mailed report. ``The suspension could cost some 1,800 tons of copper'' each day, Meyer said.
AK Steel said the price hikes take effect April 1 and will be added to the company's current pricing extras for all aluminized carbon and stainless steel products.
Here are some cute update-themselves graphs of aluminum pricing:
Unfortunately, it won't produce cute charts of longer terms, but you can see them by clicking this link.
As you can see from the longer term graphs (follow the link above), aluminum prices have doubled since 2002. This trend, repeated in copper, steel and nickel prices, shows that we can no longer take for granted the plentiful and cheap availability of these metals. The underlying factors in all cases is a wide-scale (delayed) industrial revolution in large areas of what we once called the third world. This has the ability to outstrip mining efforts for these metals and, at least in the short term and perhaps for a good long time to come, will drive up demand and therefore prices.
Now the good news, at least for aluminum, is that recycling is relatively cheap, aluminum is a low-melting point element, but even still, the scrap is worth a small fraction of the original price. Better not to make scrap at all.
In this way, certain less-wasteful processes, like slide forming, will likely become more prominent in the next few years, as the true costs of waste metal becomes increasingly obvious.
Monday, February 20, 2006
A leading U.S. senator said on Thursday he was crafting a bipartisan bill aimed at ensuring that China lives up to its international trade commitments.
'I've grown increasingly frustrated with the lack of progress on China's currency, so that's one area I'm looking into,' Senate Finance Committee Chairman Charles Grassley said at a hearing on the 2006 U.S. trade agenda.
Many members of Congress are upset with Beijing's rigid currency policy, which they say is partly to blame for last year's record $202 billion trade deficit with China.
They say China's yuan is undervalued by 15 to 40 percent, giving Chinese companies an unfair advantage in world trade.
Lawmakers also accuse Beijing of allowing rampant counterfeiting and piracy of American goods, subsidizing favored industries and blocking many imports.
'The key point is that China must live up to its commitments and to its responsibilities as a major beneficiary of the global trading system,' said Grassley, an Iowa Republican.
As chairman of the Senate Finance Committee, any bill Grassley sponsors has a better chance of becoming law than several competing China bills that have been introduced.
Grassley said he planned to work closely with Sen. Max Baucus, a Montana Democrat, to develop a bipartisan bill that would address a number of broad trade concerns, such as enforcement of international trade agreements.
Baucus and Sen. Orrin Hatch, a Utah Republican, introduced legislation on Thursday to strengthen the U.S. Trade Representative's office by creating a chief enforcement officer to investigate suspected trade violations by other countries and recommend appropriate U.S. action.
China's policy of undervaluing its currency appeared only as a footnote in an extensive U.S. government review of trade relations with China, much to the disappointment of a coalition seeking an end to Chinese currency manipulation.
Touted as a Top-to-Bottom Review of U.S.-China Trade Relations, the 29-
page report released yesterday by the Office of the United States Trade
Representative (USTR) recommends that U.S. trade resources and priorities be
readjusted to meet new challenges, and identifies trade objectives and
priority goals accompanied by key action items. 'While we support the
comprehensive approach outlined in the report, unless China stops its currency
juggling act, many of the report's goals will be rendered moot,' said China
Currency Coalition spokesman David A. Hartquist. 'That this critical issue
appeared only as a footnote in a self-proclaimed Top-to-Bottom Report is
The United States signaled its intent to seek 'trade measures' against China if Beijing does not take steps to adequately open its market to U.S. companies.
Deputy U.S. Trade Representative Karan Bhatia told the BBC's The World This Weekend the United States was 'perfectly prepared' to use trade sanctions and retaliatory force to coerce Beijing into granting U.S. companies more access to China's domestic market.
While China has vigorously warned that trade sanctions by the United States would cause damage to both countries, the United States has contended that Beijing has 'benefited enormously' from gaining access to U.S. markets and should be held accountable to its World Trade Organization obligations.
While Bhatia said the United States would work to ensure that Beijing treated U.S. companies fairly by offering a level playing field, he added that Washington would not directly restrict Chinese companies from accessing the U.S. market.
'We are not going to resort to protectionism. The answer is not going to be to shut down U.S. markets or to build up walls around our border,' said Bhatia.
The United States indicated last week that it would be revising its strategy with China after the release of its 'top-to-bottom' review of U.S. trade policies with Beijing.
'As a mature trading partner, China should be held accountable for its actions and required to live up to its responsibilities, including enforcing intellectual property rights, allowing market forces to drive economic development and opening its markets,' said Rob Portman, U.S. Trade Representative at a news conference last week. 'We will use all options available to meet this challenge.'
Sunday, February 19, 2006
the central bank has repeatedly ruled out another administered change, saying the managed float it introduced at the time of the July revaluation will allow the forces of supply and demand to gradually determine the yuan's rate.
'Making interest rates and the foreign exchange rate market-oriented to reflect supply/demand changes in the market has always been a goal that we have pursued,' Wu told Caijing, an influential business magazine.
While some people have argued that the yuan should be allowed to appreciate further, Wu said it was difficult to assess correct levels of the currency and that what was needed were moves to make the yuan more market-driven.
Caijing released the text ahead of publication on Monday.
Her comments came after she told Reuters last Tuesday that the yuan's faster pace of appreciation this year had been the result of market forces.
'I think this is the result of market operations and what we want is to let the market mechanism, based on supply and demand, play a role, she said.
The yuan can theoretically rise or fall by 0.3 percent a day against the dollar but, to Washington's frustration, it has so far moved only a fraction of that range in daily trading.
The White House, facing political pressure from a record US trade deficit, renewed its call last week for Beijing to let the yuan trade more freely, something it said was in China's own interest.
The yuan closed at 8.0483 per dollar on Friday. It has risen just 0.76 percent since the revaluation.
Hamond has in the last year acquired the facilities to double tap parts. That is, a part needing two identical threaded or tapped holes can be automatically tapped as easily as parts needing only one threaded hole. The incremental cost is low - the incremental cost of the second hole is generally less than half the incremental cost of the first one, which is itself quite low.
In addition, responding to customer requirements, Hamond has developed 2 additional abilities:
1. to tap after forming
2. to tap through 2 material layers
The ability to tap after forming allows us to tap very close to a material fold or other stretch feature without endangering the thread quality or circularity. This capability, which is only available for certain shapes and by pre-arrangement at design time, allows us to eject the part from the main forming area of the machine while retaining accurate part registration. This allows us to tap the part after forming but still on the machine, still synchronous, still in accurate registration, and therefore allows us to make the same high quality tapped hole as when we tap the strip before forming.
The ability to tap through 2 material layers allows us to make one thread that is continuous through two material layers. This allows the part designer the freedom to double material in some areas for extra strength, and still have a tapped hole feature in that area."
Friday, February 17, 2006
Portman vowed to "use all options available" to meet this goal.
Sen. Charles Schumer, D-N.Y., faulted the administration's report for failing to deal with what many manufacturing companies see as a major contributor to the trade gap -- Chinese policies that keep China's currency undervalued against the U.S. dollar, giving the country huge trade advantages against U.S. producers.
"It is amazing that in a comprehensive 29-page report, the trade representative fails to mention the 800 pound gorilla in the room -- how China manipulates its currency."
The Bush administration declared Tuesday that the United States has entered a new phase in its economic relationship with China and promised 'rigorous enforcement' of laws aimed at curbing unfair trade practices.
The pledge was contained in a 29-page administration review of America's economic relationship with China that was released four days after the government reported that the United States recorded a $202 billion trade deficit with China last year. That's the highest ever recorded with a single country and up 25 percent from 2004.
That deficit has brought renewed pressure from Congress for President Bush to be more forceful in cracking down on what China's critics see as blatant unfair trade practices in currency manipulation, theft of intellectual property and China's refusal to honor all the market-opening commitments it made when it became a World Trade Organization member in 2001.
U.S. Trade Representative Rob Portman, whose office prepared the new review, said the administration intended to use 'all options available' to address various problems with China.
John Snow, US Treasury secretary, gave another strong hint on Thursday that his department was likely to formally accuse China of being a â€ścurrency manipulatorâ€?, saying the new exchange rate regime Beijing introduced last summer has not led to greater currency flexibility.
During a visit to the Chicago Mercantile Exchange, Mr Snow said China had made little progress towards a more flexible exchange rate after it introduced a currency regime last summer, and that this would influence the Treasuryâ€™s next report on trade and exchange rates.
â€śWe havenâ€™t seen much movement towards grater flexibility and certainly that would weigh on our determination,â€? Mr Snow said.
Last July, China revalued the renminbi by 2 per cent and broke its decade-long exchange rate peg to the dollar, linking it to a basket of currencies. At the time, the Treasury welcomed the move and said it would allow a shift to greater currency flexibility over time. But since the announcement, the renminbi has risen less than 1 per cent against the dollar.
The United States told the World Trade Organization's (WTO) Dispute Settlement Body (DSB) that the amendment, which the Geneva-based WTO has repeatedly condemned, was repealed by Congress last month.
But 12 WTO states, among them Brazil, India, Australia and Mexico, countered that the U.S. move was inadequate because funds will continue to be paid out for years to come.
'Until such time as disbursements are fully and completely ceased, the United States will remain in violation of its WTO obligations,' Canada said in a statement.
Last March, the EU slapped an extra 15 percent tariff worth a total $28 million on U.S. goods including paper, agricultural, textile and machinery products, to hit back at Washington for failing to remove the measure.
Canada has imposed extra tariffs on U.S. goods worth $11 million, while those of Japan are the largest at $52 million. The amounts can be revised annually.
Under the disputed U.S. law, named after Senator Robert Byrd, Washington collected duties on imports which it had decided were unfairly priced, or subsidized, and distributed the cash to U.S. competitors of the foreign companies.
Congress struck down the measure last month in a close vote, but only with effect from October 1, 2007.
Over the next 18 months, according to official figures, U.S. firms will receive more than $2 billion under the Byrd amendment, compared with the $1.26 billion paid out since the program began in 2000.
Tuesday, February 14, 2006
General Motors Corp. said Tuesday that it will hire almost 300 workers and invest $545 million in five Michigan plants.
While the news was good for GM's home state, which has lost an estimated 130,000 auto manufacturing jobs in the last five years, the investment is dwarfed by the struggling automaker's restructuring plan, which calls for shedding 30,000 jobs nationally by 2008.
The Bush administration on Tuesday announced it will step up enforcement of U.S. trade laws governing China, following a top-to-bottom review of America's trading relationship with the Asian giant.
The increased enforcement will be led by a new chief counsel for China trade enforcement within the office of U.S. Trade Representative Rob Portman.
"The time has come to readjust our trade policy with respect to China," Portman said. "As a mature trading partner, China should be held accountable for its actions and required to live up to its responsibilities, including opening markets and enforcing intellectual property rights."
Portman vowed to "use all options available" to meet this goal.
Friday, February 10, 2006
Le gĂ©ant europĂ©en de l'acier examine la possibilitĂ© d'acquĂ©rir son concurrent amĂ©ricain US Steel pour contrer l'OPA lancĂ©e par le numĂ©ro un mondial du secteur, Mittal.
Arcelor pourrait racheter son concurrent amĂ©ricain US Steel pour lutter contre lâ€™offre inamicale de rachat lancĂ©e par le groupe indien Mittal Steel, selon le quotidien allemand Frankfurter Allgemeine Zeitung.
Arcelor aurait dans un premier temps envisagĂ© de racheter le sidĂ©rurgiste amĂ©ricain Nucor, en meilleure santĂ© financiĂ¨re. Mais devant le coĂ»t dâ€™une telle acquisition, lâ€™entreprise a renoncĂ© Ă cette idĂ©e.
OK, I think this says:
The steel giant Arcelor is considering buying it's american competitor US Steel in order to fight off the hostile takeover bid from Mittal. This is according to the German newspaper Frankfurter Allgemaine.
Arcelor also considered buying Nucor, but abandonned the idea.
Maybe I'll have to go read the original German article. My German is better.
(who woulda thunkit?)
Algoma Steel Inc. disclosed in its fourth-quarter results that it holds royalty rights on a northern Ontario property where diamonds have been discovered.
The unusual disclosure comes as the steelmaker battles a major shareholder who is attempting to force a cash payout and have the directors replaced.
"On another matter, the company announced it holds a 10-per-cent royalty on lands in Wawa, Ont., a little town about two hours north of the steel plant, owned by a company called Dianor Resources," Turcotte continued.
"Dianor is conducting a diamond exploration program on this property and has recently reported the occurrence of diamonds."
One analyst said this early-stage disclosure is another volley in the game between Sault Ste. Marie-based Algoma and New York hedge fund Paulson & Co.
Volkswagen AG said Friday as many as 20,000 jobs could be cut over the next four years as part of new restructuring plan to reduce costs and make Europe's biggest automaker more profitable.
Police are today expected to reveal details of the arrests made in a counterfeit case that is believed to have 'international implications' and has cost the TTC $5 million at a time when it's dealing with a budget shortfall.
"It's the biggest ever," said an unusually tight-lipped TTC chairman Howard Moscoe. He said the fraud wouldn't impact the fare increase announced Wednesday.
Moscoe said the dollar value of the fraud would have been enough for the TTC to buy 10 regular buses, which cost about $500,000 each.
It's believed fake tokens â€” easily duplicated with a stamping machine â€” are at the heart of the scam, although there was a hint yesterday that fake Metropasses may be involved.
Fares are now $2.25, so a $5 million fraud is just over 2 million tokens.
What interested me about this article, as a metal stamper, were some details at the end about the 2004 counterfeit case, which I don't recall seeing at the time.
The TTC, which doesn't use watermarks or other special protection measures on tickets or tokens, is an easy target for counterfeiters.
Rick Ducharme, the TTC's general manager, said in late 2004 that the system was losing about $7 million a year to fraud â€” about a third of that because of fake tickets and tokens. Ducharme said that since 2003 the TTC had laid about 450 criminal and provincial charges against people using phony tickets.
Three brothers were arrested in November 2004 for their alleged involvement in a counterfeit token operation that cost the TTC about $1.2 million over three years. One hundred bogus tokens were being sold for $120 to $130. At the time, buying 100 tokens from the TTC would have cost $190.
The fakes were lighter, thinner, duller and had slightly sharp edges.
In fact, police said, the fakes could not be used in TTC turnstiles.
Those who bought the fakes were told to use them only in fare boxes.
I was interviewed yesterday by Global TV because, as a blogger and a metal stamper, I would know something about this. I told them I knew nothing about counterfeiting, but coining is a standard process learned by tool and die students and routinely practiced by stampers, generally with bigger presses than the ones we have. So you'd be hard pressed to set up much of an operation in your bedroom, although you might do it in a tall basement.
There are several things going against the TTC in this case. I said that a fair amount of token collecting is done in fare boxes supervised by bus drivers who have plenty to do and really not much time to check the quality of the coined image on the face. You could set up a small scam by just passing anything roughly the same size and colour as a token on a bus.
So it's interesting that, in the 2004 scam, the fake tokens used weren't even the right thickness, may not have been the right alloy (lighter and duller). That says to me that they didn't have access to a service center that could get them the correct alloy (no, I don't know what alloy the TTC uses, but it is some kind of aluminum, because the coins are considerably lighter in my pocket than dimes). The "sharper edges" means that the people didn't have the proper tools or didn't know how to properly maintain their dies.
Here is a followup article from 2004, from the google cache of the CBC.ca article at the time. The original article seems to be gone.
Last stop for fake TTC tokens
Toronto â€” Police have charged three Toronto brothers after cracking a counterfeit operation that produced an estimated $1.2-million worth of illegal subway tokens.
The men, aged 59, 54 and 48, were arrested at a home in East York in a raid by Toronto Police and special constables from the Toronto Transit Commission.
Investigators estimate that the suspects produced about $400,000 worth of fake tokens a year for the past three years.
The bogus coins were manufactured using a press that stamped them out from strips of aluminum.
They could not be used in subway station turnstyles, police said, but were easily passed off as legitimate when placed in fare boxes located in buses and at the stations.
During the raid, police also discovered a plaque that the men had made to commemorate the minting of their 400,000th counterfeit token.
Here is an article from Ryerson's online newspaper talking about how it played out on campuses. There was, it seems, a distribution ring operating on the Ryerson campus.
And here's an article from Pulse24 at the time. Here's the Globe and Mail article, which names the 3 brothers charged. And a press release.
Thursday, February 09, 2006
The Toronto Transit Commission has reportedly been scammed in an International counterfeit ring.
TTC Chair Howard Moscoe says a substantial amount of money was lost because of fake tickets and tokens.
The losses are said to be in the millions.
This happened 2 years ago ... see our article at the time. That time was a smallish operation in East York. 400,000 coins at roughly $2 each. This, it seems from preliminary reports, is a larger operation.
Tuesday, February 07, 2006
We maintain our predictions of steady price erosion in this region for the next nine months. The rate of decline is not likely to be as savage as in the period September 2004 to mid 2005. The price decrease will be most pronounced in the supply of commercial grades, which can readily be produced by Asian mills and require the minimum amount of certification and testing. Prices for the superior grades should hold up better than standard specifications.
If you're not in the steel business, this rather terse paragraph needs some translation. These people do steel price forecasts for the steel industry, so their forecasts are worded so that higher steel prices are good. For metal consumers, this is a more mixed situation, but never mind. That's how the forecasts are worded.
The "commercial grades" (which can be most readily produced by Asian mills) means plain steel, hot rolled or cold rolled. These will drop in price as the imported steel floats across the ocean and arrives in North America and competes with continental steel. But that takes a while, because they don't fly them over in airplanes. And it's conditional on there being an excess in the Asian market (but that is forecast to be true).
What the Asian mills have only limited ability to produce is spring steel, stainless steel, the various coated steels (galvanized, aluminized and their combinations) and anything needing extensive certification (like automotive steel). For a slide forming shop like us, this is our bread and butter. There's very little plain cold rolled that we do. Most of our work is flat springs and formed springs (but not coil springs). These all need medium to high carbon steel, or stainless, or something. So, if this prediction is correct, there will be little to no price abatement in our input costs, and therefore, little price improvement to our customers.
Historical prices, Dec 03 to Nov 05, are available on their web site here
Dow Jones via Yahoo Asia
Funds sent flagship base metals copper and aluminum to new highs in Asia Tuesday, despite an absence of clear fundamental drivers, participants said.
The London Metal Exchange's benchmark copper contract hit an all-time high of $5,110 a metric ton, the latest in a string of records as speculators and new buy-and-hold investors continue to target metals markets.
By 0520 GMT, LME copper had eased back to $5,085/ton, but is likely to re-challenge the record, heading into London trading hours, traders said.
European steelmaker Arcelor is examining the possibility of buying US rival US Steel as a potential poison pill against a hostile takeover by Mittal Steel, the Frankfurter Allgemeine Zeitung reports.
Wednesday, February 01, 2006
United Press International - NewsTrack
Congress repealed the so-called Byrd Amendment Wednesday on a 216-214 House vote when it passed the Deficit Reduction Act of 2005.
President Bush says he will sign the bill, which contains a delayed repeal of the Continued Dumping and Subsidy Offset Act, as the law named for Sen. Robert Byrd, D-W.Va., is formally known.
In a compromise reached between House and Senate conferees, the repeal
will be delayed for two years and Byrd Amendment distributions will continue
for applications made prior to Oct. 1, 2007.
Since 2001, the Byrd Amendment has resulted in payments of more than $1.26 billion to U.S. companies affected by low-cost imports. Fully $476 million of that amount has gone to one corporation, the Timken Co. and its subsidiaries. And last year, more than half of all pay-outs went to five companies.
CITAC, of course, is happy.
CITAC Cheers Byrd Amendment Repeal by Congress
CITAC congratulates Congress for repealing the Byrd Amendment," said CITAC Executive Director Steve Alexander. "As recently as last month, many experts were saying we would never obtain congressional repeal of the Byrd Amendment during the current session. We congratulate the numerous consuming industries, consumer groups and organizations that worked together so well to make this day possible. CITAC is proud to have taken a leading role in this effort.
Gov. Joe Manchin called for all coal companies in West Virginia to halt production and perform safety checks after two more mine workers were killed Wednesday in separate accidents.
'We're going to check for unsafe conditions, and we're going to correct any unsafe conditions before we mine another lump of coal,' Manchin said.
A miner was killed at an underground mine when a wall support popped loose, said Caryn Gresham, a spokeswoman for the state Office of Miners' Health Safety and Training.
The second fatality occurred at a surface mine when a bulldozer struck a gas line, sparking a fire and killing the operator, said Dirk Fillpott, a spokesman for the federal Mine Safety and Health Administration.
The deaths brought to 16 the number of mining-related fatalities in West Virginia since January 2.
'West Virginia remains committed to putting the safety of every one of our miners first and foremost, far above any production that might come from that mining operation,' Manchin said at a news conference.
Stelco Inc. today announced that it has received a Court Order facilitating the sale of the shares of Norambar Inc., Stelwire Ltd. ('Stelwire') and Stelfil LtĂ©e to Mittal Canada Inc. ('Mittal'). The Order was granted at a hearing held this morning, notwithstanding that Stelwire was still an applicant under Stelco's CCAA proceedings. As a result of this Order, the transaction closed today.
A definitive agreement in this matter was announced on November 23, 2005 with the stated expectation that the transaction would close early in 2006. The Court approved the sale on December 12, 2005.
Stainless steel producers from Japan in the east to Kentucky in the west seem to have decided that they have had enough of falling prices and are acting to reverse the downward trend. The first few weeks of 2006 have seen a flurry of announcements of intended selling price rises.
It is quite unusual for producers in Asia, Europe and America to go for price hikes all at the same time. Three factors have prompted this unusual unanimity. First, price weakness has affected all major markets. Second, Chinese production of cold rolled stainless is lower than had been forecast â€“ thus reducing fears of excess supply. Third, alloy costs are on the rise.
Between January and December last year, basis prices for grade 304 cold rolled stainless coil (excluding raw material surcharges) fell in many of the worldâ€™s principal markets. The drop was relatively minor in the US. However, in Europe the price went down by 25 percent.
Last yearâ€™s cuts in production seem to have brought a bit more balance to the supply-demand picture. We estimate that crude stainless output in the second half of last year slipped by at least 12 percent in Europe and the Americas. Output also appears to have fallen in Asia, though more modestly.
The prospect of rising alloy surcharges next month has encouraged buyers to come back into the market to rebuild their depleted stocks. Mills, therefore, seized the opportunity. Among the first to move was Arcelorâ€™s subsidiary Ugine & ALZ, which is proposing a â‚¬50 per tonne basis price increase from February and another â‚¬50 per tonne rise in March. Other European mills are following a similar line.
In the Americas it was NAS which led the upward move â€“ announcing plans to raise basis prices by about 3 percent effective March 1. This is the first such attempt in 18 months, and was followed by other major producers.
In Europe and America the mills will have the challenge of pushing through basis price hikes at the same time as alloy surcharges are rising. This is a practical proposition if the cost of nickel continues to increase for several months. However, this latest order burst could be short lived if nickel prices start to retreat once again