AMM – 10 th Annual Pipe and Tube Conference Raw Material Analysis: Procurement Trends 10 th AMM Pipe and Tube Conference 8 th -9 th March, 2017 Houston Dhaval Trivedi Borusan Mannesmann
Mar 21, 2017
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AMM – 10th Annual Pipe and Tube Conference
Raw Material Analysis: Procurement Trends
10th AMM Pipe and Tube Conference8th-9th March, 2017
Houston
Dhaval TrivediBorusan Mannesmann
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The image part with relationship ID rId3 was not found in the file.
Raw Material Analysis: Procurement Trends
AMM – 10th Annual Pipe and Tube Conference
Discussion Points…
• How have duties placed on imports of HRC from certain countries changed procurement strategies for welded pipe producers?
• Are there other sources of price competitive HRC available?
• How will this change price dynamics when it comes to welded vs seamless pipe?
• Will price changes be passed on to consumers of tube and pipe?
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The image part with relationship ID rId3 was not found in the file.
USA Steel and Steel Product Imports - 2016
AMM – 10th Annual Pipe and Tube Conference
US Department of Commerce reported…
• World’s Largest Steel Importer: 22.6 million metric tons
• Import Penetration Down to 29.9% in YTD 2016 from 34.7% in YTD 2015
• Top Three Import Sources: Canada, Brazil and South Korea
• Largest Producers: Nucor, US Steel and ArcelorMittal USA
• 116 Trade Remedies in effect against imports of Steel Mill Products
9.10
5.40 4.50
2.90
0.65
-
2.00
4.00
6.00
8.00
10.00
Flat Long Semi-Finished Pipe andTube
Stainless
2016 YTD - Steel Imports
40.30 35.46
22.60
-
10.00
20.00
30.00
40.00
50.00
2014 2015 2016
Steel Imports - Last Three Years
Data in Million Metric Tons, Data Resource: US Department of Commerce, Enforcement and Compliance Report December 2016
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The image part with relationship ID rId2 was not found in the file.
Global Trade Measures on Hot Rolled Steel - 2016
AMM – 10th Annual Pipe and Tube Conference
USA:August 3, 2016 –AD/CVD on 7 Countries
European Union:Oct 7, 2016 –Duties on Chinese HRC
India:March 23, 2016 –Safeguard Duties
Mexico:April 4, 2016 –Extended Import Duties
Brazil:Nov 21, 2016 –Anti-Subsidy Investigation launched against HRC from China
AustraliaNov 10, 2016 – Anti-Dumping Investigation launched
Turkey:Apr 20, 2016 – Anti-Dumping Investigation was withdrawn
Data Resource: AMM Research & Metal Bulletin Research
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The image part with relationship ID rId2 was not found in the file.
Top 10 Steel Producing Countries & Steel Consumption
AMM – 10th Annual Pipe and Tube Conference
Global Crude Steel production is approximately 1500 Million Metric Tons Annually.
804
105
89
79
71
70
43
33
32
23
672
63
80
96
40
56
39
21
34
3
98
35
-5.7
-27
25
10
0.3
11
-3.7
17
-50 50 150 250 350 450 550 650 750 850
China
Japan
India
USA
Russia
S Korea
Germany
Brazil
Turkey
UkraineNet Export Finished Steel Consumption Production
Data Resource: World Steel Association and Department of Commerce, US Government
Data is in Metric Tons for reporting year 2015
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Price Trends 2014-2016
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AMM – 10th Annual Pipe and Tube Conference
$143
$246
$359
$637
$37
$102
$270
$379
64%
66%
68%
70%
72%
74%
76%
78%
80%
$-
$100
$200
$300
$400
$500
$600
$700
$800
Jan-
2014
Feb-
2014
Mar
-201
4Ap
r-20
14M
ay-2
014
Jun-
2014
Jul-2
014
Aug-
2014
Sep-
2014
Oct
-201
4N
ov-2
014
Dec-
2014
Jan-
2015
Feb-
2015
Mar
-201
5Ap
r-20
15M
ay-2
015
Jun-
2015
Jul-2
015
Aug-
2015
Sep-
2015
Oct
-201
5N
ov-2
015
Dec-
2015
Jan-
2016
Feb-
2016
Mar
-201
6Ap
r-20
16M
ay-2
016
Jun-
2016
Jul-2
016
Aug-
2016
Sep-
2016
Oct
-201
6N
ov-2
016
Dec-
2016
Jan-
2017
Mill
Util
izat
ion
US
$/sh
ort t
on
#1 Busheling Scrap - Chicago HRC Midwest Iron Ore 62% Fe, CFR China
1st Grade Coke, FOB China Billet, FOB Turkey US Mill Utilization
Global Mill Utilization
Mar 15, 2016 – Preliminary Duties Announced in USA
Data Resource: AMM Research, Metal Bulletin Research, WSA and AISI
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HRC Price and OCTG Consumption 2015-2016
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AMM – 10th Annual Pipe and Tube Conference
0.79
0.20 0.19 0.37
4.40
13.20
13.90
6.60
-
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
9.00
10.00
11.00
12.00
13.00
14.00
$-
$100
$200
$300
$400
$500
$600
$700
OCTG Consumption (Million Tons) #1 Busheling Scrap - Chicago HRC Midwest Months of Supply
Mar 15, 2016 – Preliminary Duties Announced in USA
Data Resource: AMM Research, Metal Bulletin Research and OCTG Situation Report
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Notable Steel Import Trends for Last 6 Months
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AMM – 10th Annual Pipe and Tube Conference
Data Resource: US Department of Commerce, Enforcement and Compliance SIMA (Steel Import Monitor)
Product Country
Monthly Average Between
Nov 2016 & Jan 2017
Monthly Average Between Aug 2016
& Oct 2016
% Change
Blooms, Billets & Slabs World 50,857 7,890 545%Argentina 12,551 3,286 282%Canada 6,154 2,456 151%Korea 52,639 22,306 136%World 133,683 77,358 73%Canada 7,869 1,951 303%India 13,227 3,396 289%Greece 14,000 5,605 150%
Structural Pipe & Tube Korea 10,391 5,020 107%Hot Rolled Sheets Korea 13,570 70,499 -81%
Oil Country Goods
Line Pipe
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Major Steel Mills in USA
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AMM – 10th Annual Pipe and Tube Conference
Furnace Type
Annual Capacity (Million
Tons)
Notes
AK Steel BOF 8.20
ArcelorMittalBOF 21.60 Riverdale Idled, Hot Strip Mill in Indiana
Harbor Idled.EAF 0.88
Big River Steel* EAF 1.60 Start-up OperationNLMK EAF 0.80 Nucor EAF 14.80 SSAB EAF 2.50 Steel Dynamics EAF 6.40
United States Steel BOF 17.50 Fairfield Permanently Idled in Aug 2015, Granite City Temporarily Idled
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Thank you!
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AMM – 10th Annual Pipe and Tube Conference
Questions….???