On Fri, 05 Dec 2003 00:03:37 GMT, the renowned Mark
wrote:



Glenn Ashmore wrote:

Seems the Chinese are on a building binge and are scarfing up all the
steel they can get their hands on. Scrap prices have already increased
considerably. As far as he is concerned US steel makers have been
crying wolf all along.



My guess is the Chinese are buying up scrap to create a shortage. It's
easier/ cheaper to make steel from scrap. I think that would drive US
manufacturers cost higher making the US even less competitive.

http://uk.biz.yahoo.com/031104/80/ed0un.html

MONACO, Nov 4 (Reuters) - Nickel prices could reach more than $15,000
a tonne ($6 a lb) in 2004-5 because of an expected boom in Chinese
demand, an extremely limited supply response and chronically low
global stock levels, an industry analyst said on Tuesday.

In a paper to delegates attending a Metal Bulletin (LSE: MTLB.L -
news) ferro-alloys conference, Jim Lennon from Macquarie Bank said
prices could push up to levels last seen 15 years ago.

"Prices will have to rise sharply -- and may stay high for a long
time," he said.

China would play the dominant role in nickel prices because of the
strong pace of its demand, particularly in stainless steel production,
he said.

In global terms, Chinese consumption accounts for more than 21 percent
of a total 1.242 million tonnes.

Stainless steel production accounts for two-thirds of nickel
consumption.

http://www.cdrecycler.com/news/news.asp?ID=1382

Ferrous Price Spike Predicted

Vicki Roche, a scrap buyer for steelmaker Gerdau AmeriSteel Corp.,
Tampa, Fla., said she has seen scrap prices averaging about $3 per ton
higher thus far in September. She noted that offshore demand for
ferrous scrap is likely to continue and that pig iron out of Brazil is
sold out through January of 2004, causing further demand strain on the
market.

According to Roche, though, some of the other “perfect storm” factors
that drove scrap prices up are alleviating. She noted that the labor
situation that restricted DRI production in Venezuela has eased and
that the Russian 30-euros tax on exported scrap could be lifted
sometime soon.

Industry analyst Marcus, though, believes there are still overall
supply constraints that, coupled with a booming Chinese steel
industry, will make for a lack of steel furnace feedstock relative to
global demand.

Marcus said that even though much of the new Chinese capacity consists
of blast furnaces, a shortage of iron ore capacity will cause buyers
at these mills to seek more scrap from an obsolete scrap reservoir
that is already straining to feed the world’s electric arc furnace
(EAF) mills.

That shortage is already showing this year, by Marcus’ calculations,
with a theoretical shortfall of 36 million metric tons of obsolete
scrap in the market in his “most likely” scenario, followed by
shortages of 40 million metric tons next year, 45 million metric tons
in 2005 and 50 million tons by 2010.

OTOH, Dubya could always seize Chinese assets.

Chow mein noodles could be as dangerous as pretzels.

Best regards,
Spehro Pefhany
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