Steelmaking raw materials: Market and Policy Developments

Transcription

1 Steelmaking raw materials: Market and Policy Developments DSTI/SU/SC(2010)16 69 th Steel Committee Meeting Paris 3-4 December 2010 Summary Recovery in world output of steel has raised the demand for raw materials Miners have reacted by raising supplies However export restrictions have added strain on supply And raw material prices have risen significantly this year 1

2 Price increases since the start of 2010 Iron ore and coking coal (contract) have risen by 80% and 62% respectively, Price of coke has increased by 57%. The price of ferrous scrap has increased by a somewhat smaller margin than other steel-related raw materials, doing so by 31% since the start of this year Index 2004=100 Scrap (USA) Iron ore (contract) Coke () Coking coal (contract) Q1 2005Q1 2006Q1 2007Q1 2008Q1 2009Q1 2010Q1 Iron ore demand strong in 2010 In the first three quarters of 2010, iron ore imports grew by almost 40% in Japan and Korea, and by nearly 60% in Chinese Taipei. is the world s largest importer of iron ore by far, accounting for approximately 70% of global imports. Demand for iron ore has been strong, though met mainly this year by local mine output not imports. 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Japan S.Korea Asian import reliance on iron ore 2

3 Brazil Iron ore: Major Exporters Brazilian output rose by more than a third in the first half of 2010, in year-on-year terms, supported by higher demand in traditional markets in Europe. Brazilian exports hit a record level in the third quarter of this year. Australia Australian production are also up significantly, supported by projects which started production in early In the first three quarters of 2010, Australian iron ore exports were up by 11%, with a small decline in shipments to being more than offset by strong growth to Japan. India Indian supply of iron ore to world markets has contracted sharply recently, partly the result of higher export taxes on iron ore, growing domestic demand, and the export ban implemented by the state of Karnataka, which accounts for approximately one-third of Indian exports. India Iron ore: policy measures The India imposes a 5% duty on fines and a 15% duty on lumps (increased from 10% in April 2010). In July 2010, the Indian state of Karnataka started to ban exports of iron ore from ports controlled by that state to address illegal mining activities in the region. India requires that exports of high-grade iron ore (>64% Fe content) pass through state trading enterprises, with the state-owned Minerals and Metals Trading Company acts as a clearing house. has imposed an export duty on the sale of iron ore, which is reported to be 10%. 3

4 Iron ore: policy measures (cont d) Vietnam The Vietnamese government increased the export duty from 20% to 30% in November Argentina Argentina imposes 10% duty. Malaysia Quantitative restrictions on iron ore also exist in Malaysia, in the form of non-automatic export licenses. Iran Iran has a ban on iron ore concentrate. Coking coal: Major importers Although is the world s largest producer of coking coal, imports surged by more than 400%, to 34.7 million tonnes in India Indian imports increased by 11.3%, to 23.5 million tonnes in Strong growth in steelmaking capacity and production in coming years should raise India s reliance on imported coking coal even further. Other countries Traditionally large importers, such as Japan, Europe and Korea, saw their imports fall in 2009, but growth has resumed during 2010 in line with strengthening activity in their steel industries. 4

5 Coking coal: Major exporters Australia Australian exports are up 24% so far this year, capacity expansions in Australia should support further export growth in the coming years. United States United States exports increased by nearly 70% during the first three quarters of 2010, though growth has slowed more recently in line with developments in market demand. Canada Canadian exports have also increased rapidly this year, particularly to Japan where shipments have increased by more than 50%. Russia Russia has recorded export growth of around 60% since the start of the year, despite reports of coal mine explosions in western Siberia earlier this year. Coking coal and Coke: Policy measures has an export quota and tax (40%) on coke. As regards coking coal,, Vietnam and Indonesia impose export duties. 5

6 Scrap: Major importers Chinese imports surged to 13.7 million tonnes from 3.6 million tonnes in 2008, as integrated producers purchased more scrap owing to the favorable price relative to imported iron ore at the time. S.Korean mills also purchased more imported scrap in Although Turkish imports fell sharply in early 2009, they have been recovering since then Import of ferrous Imports scrap during mmt EU Taipei Turkey S.Korea Scrap: Major exporters U.S. scrap exports for 2009 as a whole rose to 22.4 million tonnes, supported by an increase in exports to. Japan recorded a new high in scrap exports in 2009 driven by increases in shipments to, South Korea and Chinese Taipei. Prohibition of scrap shipments through some ports during March- October 2009 may explain part of the drastic, 77% decline in Russian scrap export last year Export of ferrous scrap during Exports mmt EU Ukraine Japan Russia USA

7 Scrap: Policy measures Trade in scrap is affected significantly by a large number of government measures. According to some news sources, the Iranian government is considering increasing its scrap export duty from 50% to 70%. South Africa and Ukraine have introduced non-automatic export licences as well as export registration requirements and fees. Export taxes on scrap in selected countries Country Tariff Rate Argentina 20% 40% Egypt 500 to 1500 EGP/t India 15% Iran 50% Kazakhstan 15%, minimum of 20 EUR/t Kenya 25% Malaysia 10% Russian Federation 15%, minimum of 15 EUR/t Ukraine 16.4 EUR/t Vietnam 25% United Arab Emirates Dirham 250/t Scrap: Policy measures(contn d) South Africa and Ukraine have introduced non-automatic export licences as well as export registration requirements and fees. Quantitative restrictions on scrap in selected countries Country Argentina South Africa Azerbaijan Indonesia Jordan Kazakhstan Kenya Malaysia Sri Lanka Ukraine Uruguay Type of measure Temporary export ban Export permit Export quota Non-automatic export license Export license 7