Commodity Insights Magazine showcases our pricing, news and analytics across global energy and commodities markets. Download the latest issue of the magazine
Listen now as Sarah BalticManaging EditorNonferrous Metals Markets, and Karen McBethDirector, Global Metals Engagement & IntelligenceS&P Global Commodity Insights summarize on the key trends and takeaways from Aluminum Symposium 2024.
Listen now as Edwin PopePrincipal Research AnalystSupply Chain & Technology GroupS&P Global Mobility discusses aluminum demand across sectors and main trends that were seen with respect to its application in the automotive sector from the Aluminum Symposium 2024
Asian aluminum markets continue to see lackluster demand and ample stocks pressuring premiums, though the sporadic reopening of the Chinese import arbitrage window is providing support across the region.Further upstream in the alumina markets, flat demand remains a drag on prices globally, but cost pressures and output curtailments are keeping significant declines at bay.As the market looks at what’s ahead for 2024, YuenCheng Mok, Senior Managing Editor of Asia nonferrous metals at S&P Global Commodity Insights discusses the key developments in the Asian alumina and aluminum markets with Jenson Ong and Germaine Lee from the Asia nonferrous metals team, and Lucy Tang, market specialist for Metals.In this podcast, find out what’s in-store in the near term for these markets.Related prices:Alumina FOB AustraliaAlumina FOB Brazil differentialAlumina ex-works ChinaAluminum CIF Main Japanese Ports (MJP) premiumAluminum CIF Main Asian Ports (MAP) premiumMore listening options:
Interview with Tim Armstrong, senior vice president of planning solutions for S&P Global MobilityLearn more about issues pivotal to the aluminum sector at S&P Global Commodity Insights Aluminum SymposiumConferences LIVE
Legislation and consumer demand are driving increased demand for electric vehicles, increasing the need for critical materials to build out battery supply chains. Tim Armstrong, senior vice president of planning solutions for S&P Global Mobility, puts the demand for critical materials into context and discusses the main drivers for EV expansion.Learn more about issues pivotal to the aluminum sector at S&P Global Commodity Insights Aluminum Symposium
China has set quotas for the first batch of rare earth mining and smelting in 2024 at 135,000 mt and 127,000 mt, respectively, raising the quota volume for both the operations from the last year's first-batch quotas, according to a Feb. 6 statement from the Ministry of Industry and Information Technology and the Ministry of Natural Resources.Rare earth metals are about a group of 17 elements that are considered highly critical for energy transition. China leads the global rare earth sector in terms of production and refining technologies.With China's dominance, it controls its rare earth supply through the closely watched quota system.The quotas for rare earth mining and smelting for 2024 are 12.5% and 10.4% higher, respectively, from the first batch quota released in March 2023.But despite a sharp year-on-year rise in 2024 quota, the increase was still below than the 19% and 18.3% year-on-year increase witnessed for the first batch quota for mining and smelting, respectively, for 2023, S&P Global Commodity Insights calculations showed.The quota for medium to heavy rare earths saw a decline of 7.3% year on year, which highlighted its scarcity and strategic position, China's ministries said in the statement. Meanwhile, the quota of light rare earths saw an increase of 14.5% from the previous year.The total mining and smelting output quota in 2023 reached 255,000 mt and 243,850 mt, up 21.4% and 20.7%, respectively, from a year earlier, according to ministry data.Rare earth is a product subject to total production control and management by the state, and no enterprise or individual can produce it without or beyond the quota, according to the statement.Rare earth metals like neodymium, praseodymium, dysprosium and terbium are key to the production of permanent magnets used in electric vehicles (EVs) and wind turbines.China is also the world's largest consumer and importer of rare earth metals.China imported 175,853 mt of rare earth metals in 2023, up 45% from a year earlier, according to China's latest customs data. At the same time, China exported 52,307 mt of rare earth metals, up 7.3% from a year ago.
Listen now as Dr Srini Godavarthy, CEO, Li-Metal Corporation discusses on the nomination for the Global Energy Awards Energy Transition - Technology of the Year Finalist award! For a quarter century, we have been honored to recognize the energy sector’s exponential growth and rapid progress. As the world comes together to tackle climate change issues at COP28, we are gathering the industry to acknowledge the companies and individuals working on the crucial, innovative, practicable solutions that will solve those problems. Shine a spotlight on your organization’s accomplishments and join us this December 7th in New York City, USA to celebrate the many achievements and successes of the global energy community. Learn more now
Rio Tinto has signed a five-year agreement to supply global cable manufacturer Prysmian with low-carbon aluminum produced using renewable hydropower from Rio Tinto’s Canadian operations, the company said Oct. 30. The partnership aims to help build a more sustainable North American supply chain for materials to expand power grids for the energy transition, Rio Tinto said in a statement. Power generation from renewables in the US is expected to increase from 21% in 2021 to 44% in 2050, according to the US Energy Information Administration’s 2022 Annual Energy Outlook, requiring significant investments in power grids and boosting demand for innovative materials used in electrification projects. The low-carbon aluminum supplied by Rio Tinto will be used for advanced power cables, seen critical for grid expansion for the transition to renewable energy sources. Aluminum is seen by some analysts as increasingly suitable and cost-effective for filling gaps that may be left by an expected market deficit of copper in the global electrification drive over coming years. This agreement will support Prysmian’s aim to be carbon neutral by 2050, the cables maker said. The companies have also signed a development agreement to leverage technologies, research and development capabilities, and expertise to develop multimaterial solutions in support of North America’s growing electrification demand, according to the statement. Learn more at the Aluminum Symposium | Scottsdale, AZ | January 28-30, 2024
Nissan has announced that all new model sales in Europe will be battery electric vehicles from now on, with the company aiming for the total electrification of its European fleet by 2030, it said in a statement Sept. 26. According to the company, the electrification program, part of its Ambition 2030 strategy, would be supported by an investment of more than GBP40 million. Nissan said the investment would be used specifically to upgrade resources and facilities at the Nissan Design Europe site in London and the at Nissan Technical Centre Europe in Bedford. "EVs powered by renewables are key to us achieving carbon neutrality, which is central to our Ambition 2030 vision. Nissan will make the switch to full electric by 2030 in Europe - we believe it is the right thing to do for our business, our customers and for the planet," said Nissan President and CEO, Makoto Uchida. EVs currently represent around 16% of Nissan's total sales in Europe, it said, part of a total electrified sales mix of 50%, which it expects to increase to 98% in the next three years. Under Nissan Ambition 2030, the company is planning to release 27 electrified vehicles, including 19 EVs, by 2030. During this period, Nissan also plans to adopt cobalt-free battery technology which it expects will lower the cost of EV batteries by around 65% by 2028. The company is also aiming to launch EV models utilizing its proprietary all-solid-state batteries (ASSB) by 2028. Nissan said that it expects ASSB to bring the cost of battery packs down to $75/kWh by 2028 and potentially as low as $65/kWh in the years that follow. "With breakthroughs in battery technology, electric vehicles will become even more accessible, and Nissan will continue to champion EV as the best way to provide cleaner, simpler and more affordable mobility," said Nissan Chairperson for the AMIEO region (Africa, Middle-East, India, Europe and Oceania) Guillaume Cartier. In July 2021, Nissan announced that Envision AESC would build a 9 GWh battery factory at its plant in Sunderland. The company has not yet provided a date for commissioning. According to the European Automobile Manufacturers Association (ACEA), nearly 1 million battery Evs were registered in the EU during the first eight months of 2023, up 62.7% year on year. Platts, part of S&P Global Commodity Insights, assessed seaborne lithium carbonate and lithium hydroxide at $24,000/mt CIF North Asia and $27,000/mt CIF North Asia, respectively, Sept. 26, down 68% and 65% since the start of the year. More about Conferences LIVELearn more at the Aluminum Symposium | Scottsdale, AZ | January 28-30, 2024
Seaborne iron ore prices picked up speed to exceed the $110/dmt CFR China mark Aug. 21, a three-week high, backed by a recovery in demand-supply fundamentals coupled with increasing clarity around China's steel production control and volumes, market sources told S&P Global Commodity Insights. The Platts-assessed Iron Ore Index, or IODEX, touched $110.35/dmt CFR China Aug. 21 but was largely rangebound between $100-$110/dmt CFR China earlier in August for delivered cargoes in the 2-8 weeks forward window, S&P Global data showed. Platts IODEX was last higher on July 27 when it was assessed at $113.10/dmt. Through the first half of August, Platts IODEX was bogged down by pockets of bearishness, falling to a low of $103.35/dmt on Aug. 10, but looks to be realigning with market fundamentals. Downstream steel mill margins drew a parabola through the month, kicking off on a positive note but slipping shortly after. News around steel production controls cast a dark cloud over market confidence through the first half of August, albeit no official confirmation was heard among market sources. "Steel mills have no clear [direction] on production control policies to recover market confidence," a north China-based mill source said. "Market will need some time." However, market sources said prices were heading north due to a slew of factors including bullish macroeconomic news re-instilling confidence in the market and sustained import margins as prices appeared to have bottomed out and reached a support level. The People's Bank of China lowered the one-year Medium-term Lending Facility rate to 2.50% from 2.65% Aug. 15, a sign that the government may be ramping up monetary easing efforts to boost a sputtering economic recovery. On top of which, the Asian iron ore market witnessed positive import margins for around 60 consecutive days, indicating that seaborne procurements were more cost competitive compared with purchases from Chinese portside, on an import parity basis. "The price difference [in import margins] is significant for recent seaborne trade activities to flourish," an iron ore trader said. The utilization rate in blast furnaces was also reportedly higher, an indication of an increase in iron ore consumption for crude steel output, sources said. "The main factor for the price increase will be the high operating rates and high crude steel output," another international iron ore trader said. Impact on production news cut fade Market sources attributed the recent recovery in seaborne iron ore prices to the impact of steel production cuts tapering off. "It could just be a correction [in seaborne prices] because of the overly bearish outlook from production control policies since production cuts in only specific areas allow other steel mills to increase the production instead, but I guess total production volume will not exceed [that of] 2022," a north Asia-based iron ore trader said. A Beijing-based Chinese trader said the recent rally in iron ore prices was mainly a correction following an overly bearish market outlook previously. "September we will see steel demand step out of the bottom as the peak season is coming. The supply of mainstream iron ore cargoes continues to be tight and port inventory has fallen to around 120 million mt level. The fundamentals of seaborne iron ore market itself are healthy," the trader said. Meanwhile, the policy for crude steel production cuts remained uncertain in terms of its implementation and whether it will lift seaborne prices in the interim, sources said. "The responses from the top steel-making hubs, including Hebei province and Shandong province, are key to the success of maintaining crude steel production flat from 2022. While by end-August we haven't yet seen any scaled production cut happening in Tangshan and it's questionable whether the target could still be met by the end of the year," another Beijing-based steel mill source said. Before the close of the trading week ended Aug. 18, an uptick in the finished steel output reported in China despite news of production controls reflected resilient buying interests, credits to stable operation rates and healthy import margins. Downstream steel sales also recovered in the second decade of August, signs in which HRC and rebar margins have improved.
China's steel markets remain under pressure amid piling up inventories at a time of robust production and weak demand, a development that comes at a time of growing signals over imminent output cuts in the country, industry sources said Aug. 7.Chinese domestic rebar prices in Beijing fell by Yuan 103/mt ($14.3) from Aug. 1 to Yuan 3,753/mt on Aug. 7, while the domestic hot rolled coil prices in Shanghai fell by Yuan 100/mt over the same period to Yuan 3,970/mt, S&P Global Commodity Insights data showed.Rebar inventories in the eastern trading hub of Hangzhou as of Aug. 4 were about 13% higher on the month and 35% higher on the year, sources said. Meanwhile, long steel inventories in northern Beijing -- mainly rebar and wire rod -- were still about 3% lower on the year, but up by 14% from early July, they said.The hot-rolled coil inventories as of early August in eastern China's Shanghai and southern China's Guangdong Lecong markets also showed upward trend, increasing by 17% and 3%, respectively, from early July, according to sources.Some steel traders said market sentiment was at the low point at the moment amid rising inventories. Unfavorable weather across China in the last two weeks further dented domestic steel demand, and it remains unclear when China's steel output cuts could actually begin, the trading sources added.Market chatter indicated that China's largest steelmaking province, Hebei, may soon announce steel output cut details around mid-August."Even if Hebei and other provinces announce to keep their 2023 crude steel output below 2022 levels, the question remains that when and how strictly the output cuts can be carried out," a trader said."Chinese steel mills are currently almost running at full operation, which is likely to cause inventories to continue rising at least through August...I'm just a bit cautious whether Chinese mills could achieve output cut goals all in the fourth quarter," another market participant said.However, some other market sources still expected China would keep its overall crude steel production in 2023 within 2022 levels, and Q4 could create a good opportunity to time steel output cuts due to low seasonal demand.According to data from the China Iron & Steel Association, the country's daily crude steel output in July may average 2.999 million mt.If the output in August remains the same as in July, the daily crude steel output over September-December will have to fall by 19% from July-August level to around 2.43 million mt, in order to keep China's annual crude steel output on par with 2022 levels, S&P Global calculations showed.
Singapore | March 12-14, 2024
Dubai | April 23-25, 2024