October 2022
IRON ORE & STEEL
CHINA’S BUILDING SEASON FLOP DENTS HOPE OF IRON ORE MARKET BOOST
Source: Mining
The iron ore market just had its longest weekly decline on record.
The start of China’s peak construction season was supposed to finally boost demand for iron ore, which has endured a tempestuous year with prices now trading near 2022 lows. But the bounce hasn’t happened. China’s usual boom period for infrastructure construction and steel-related demand in September and October has so far offered no reprieve for investors in the iron ore market, which just notched its longest streak of weekly losses on record. The economy continues to contend with severe housing slump and virus-related lockdowns…FULL STORY
STEEL ASSOCIATION WILL MAKE STABLE OPERATIONS A PRIORITY
Source: China Daily
China Iron and Steel Association, a non-profit organization with 218 steel producers as member companies, vowed to take measures to maintain stable operation of the industry amid weakening demand and high prices of raw materials.
Qu Xiuli, vice-chairman and secretary general of the association, said on Monday that CISA will strengthen cooperation between the government and its constituent companies, actively explore and establish a new mechanism to manage production capacity, as well as promote the companies’ consolidation and reorganization…FULL STORY
IRON ORE OUTLOOK CLOUDED BY GLOBAL DEMAND WOES, SUPPLY RISK
Source: Nasdaq
Iron ore prices are on track to end 2022 at their lowest in the last three or four years and will probably languish next year as well, with China and Europe cutting steel output, while pressure mounts form additional supply.
Price forecasts for the key steelmaking ingredient range from about $90 a tonne to a high of $115 by the end of the year, a Reuters survey of five analysts and researchers shows. Year-end prices have not been in this territory since the 2019 figure of $93 a tonne, itself off the even lower 2018 level of $72.60, data from consultancy SteelHome shows.”COVID-19 and property sector slowdown continue to weigh down steel demand in China,” said Malan Wu, research director at consultancy Wood Mackenzie…FULL STORY
SHANDONG STEEL’S NET PROFIT DECLINES BY 90.63 PERCENT IN JAN-SEPT
Source: SteelOrbis
Shangdong province-based Chinese steel producer Shandong Iron and Steel Co., Ltd has announced that it registered an operating revenue of RMB 76.596 billion ($10.7 billion) in the January-September period this year, down 12.25 percent year on year, and a net profit of RMB 168 million ($37.3 million), decreasing by 90.63 percent year on year.
In the July-September period, it registered an operating revenue of RMB 23.046 billion ($3.2 billion), declining by 19.01 percent year on year, and a net profit of RMB 831 million ($116million), down 21.53 percent year on year…FULL STORY
IRON ORE FUTURES ON THE DALIAN COMMODITY EXCHANGE FOR THE WEEK OF OCTOBER 21-28, 2022, FELL BY 8% COMPARED TO A WEEK EARLIER
Source: GMK center
January iron ore futures on the Dalian Commodity Exchange for the week of October 21-28, 2022, fell by 8% from the previous week – to 624.5 yuan/t ($86.31/t). Thus, quotations of iron ore are falling for the third week in a row.
November iron ore futures on the Singapore Exchange fell to $78.8/t, the lowest since 2020. As of October 28, 2022, iron ore quotations in Singapore are down 50% from their April peak, when the iron ore was selling at $160/t. Spot iron ore fell to its lowest level since May 2020, below $90/t, as negative margins prompted Chinese steel mills to curb production…FULL STORY
AN INCREASE IN SUPPLY IN THE FOURTH QUARTER OF 2022 WILL PUT PRESSURE ON IRON ORE MARKET
Source: GMK center
A slowdown in demand for iron ore was observed in the third quarter of 2022. Despite the downturn in the Chinese steel market, major mining companies are operating with a view to the long-term prospects in the global steel market.
Traders and experts believe that until the end of 2022, the iron ore market will move on a downward trajectory. In the near term, it will be affected by China’s economic problems, particularly in the real estate sector, and the country’s policy of zero tolerance for Covid-19. The British-Australian concern Rio Tinto noted in the report for the third quarter of 2022, that the iron ore prices continued their downward trend during this period, and there are further risks of a slowdown in demand due to the situation in the global economy…FULL STORY
SHIPPING: CAN CHINA OFFER A HELPING HAND?
Source: Hellenic shipping news
China’s economic recovery is hinging on a number of policies, which in turn could be forged during this week’s congress of the country’s ruling Communist party. In its latest weekly report, shipbroker Allied Shipbroking said that “yesterday marked the start of the long-awaited Chinese Communist party congress. Taking place twice a decade, it is the most important meeting of China’s ruling Communist party and its role is to announce key appointments, including the party leader, as well as outline the direction that will be taken over the next 5-year plan. With the doors now open for Xi Jingping to be reappointed for a third term (a first since the constitutional limits had been removed), all attention has been focused on any and all measures and directions that will be announced as part of the next five-year plan for the world’s second-largest economy…FULL STORY
COAL
CHINA COAL TRADE DISRUPTED BY COVID OUTBREAKS AS WINTER LOOMS
Source: Reuters
China’s strict COVID-19 policy is constraining coal supplies and pushing up prices, industry officials and traders say, just weeks before the country’s north switches on mostly coal-fired heating systems for winter and demand jumps.
The world’s top coal consumer still relies on the fuel to heat homes across much of the colder north, and Beijing is determined to ensure sufficient supplies this year after shortages led to unprecedented power outages in 2021…FULL STORY
RUSSIA SHIPS RECORD VOLUMES OF GAS AND STEELMAKING COAL TO CHINA
Source: Bloomberg
China imported record quantities of Russian liquefied natural gas and steelmaking coal in September, as total purchases of energy products topped $50 billion since the invasion of Ukraine pushed Moscow to expand sales to its strategically.
Coking coal imports from Russia jumped to 2.5 million tons in September, from about 900,000 tons in the same month last year and 1.9 million tons in August, according to Chinese customs data….FULL STORY
CHINA COAL IMPORTS JUMP; RUSSIAN CARGOES FALL
Source: Hellenic shipping news
China’s coal imports rose 12.2 per cent in September from a month earlier as the world’s top consumer of the fuel brought in larger shipments of cheap Indonesian coal.
Coal imports totalled 33.05 million tonnes last month, up from 29.46 million tonnes in August and slightly higher than last September’s 32.88 million tonnes, data from the General Administration of Customs showed on Monday…FULL STORY
ASIA MET COAL MARKET SEE LIGHT AHEAD ON Q4 RESTOCKING DEMAND, SCARCE SUPPLIES
Source: S&P Global
The seaborne metallurgical coal market is entering the fourth quarter on firmer footing, as weather-related disruptions stoke supply worries while year-end restocking demand from India and China keep prices supported after a volatile Q3.
Benchmark Platts premium low-volatile hard coking coal prices, basis FOB Australia, declined $31.5/mt, or 10%, on the quarter to $270.50/mt while PLV CFR China was down $86/mt, or 22%, to $308/mt at the end of Q3, S&P Global Commodity Insights data showed…FULL STORY
CHINA’S ENERGY SECURITY PLAN SIGNALS LONGER LIFE FOR COAL DESPITE CLIMATE VOWS
Source: S&P Global
China’s coal production and consumption are likely to rise in the near term, as the country’s top leaders underscored energy security during the twice-a-decade National Congress of the Chinese Communist Party.
Despite the government’s unchanged commitment to cut carbon emissions, coal will continue to play a vital role in China’s energy mix until the country’s rapidly expanding renewable power supplies can meet energy needs, officials and experts said. China has ramped up coal production, approved more projects, supported financing and shortened the safety inspection period to prevent a repeat of the coal shortage that triggered a power crunch in 2021…FULL STORY
SOYBEAN
CHINA REMAINS LARGEST PURCHASER OF US SOYBEANS, STRONGER COLLABORATION EXPECTED: US INDUSTRY REPRESENTATIVE
Source: Global Times
China remains the largest customer for US soybean, and the growth in China has been “amazing and fulfilling”, Jim Sutter, CEO of the US Soybean Export Council (USSEC) and chairman of the US Agricultural Export Development Council, said in a written interview with the Global Times on Wednesday, expressing his expectations for stronger bilateral trade in agricultural goods.
Amid growing speculation of weaker agricultural trade flows between China and the US due to climate change, geopolitical tensions and the pandemic, Sutter said that he remains confident in soybean trade with China, which is still the No 1 customer for US soybeans….FULL STORY
CHINA SEPT SOYBEAN IMPORTS JUMP 12% FROM A YEAR EARLIER -CUSTOMS
Source: Nasdaq
China’s soybean imports in September rose 12% from a year earlier to 7.72 million tonnes, customs data showed on Monday, reversing a months-long trend of low arrivals
BEIJING, Oct 24 (Reuters) – China’s soybean imports in September rose 12% from a year earlier to 7.72 million tonnes, customs data showed on Monday, reversing a months-long trend of low arrivals…FULL STORY
ENERGY
CHINA’S BIGGEST REFINER SEES PROFITS DROP AMID WEAK FUEL DEMAND
Source: Oil Price
Sinopec, the biggest refiner in China and Asia, has suffered from the Covid lockdowns and weaker Chinese fuel demand this year as its January-September net profit dropped by 5.6% compared to the same period of last year.
Sinopec’s net profit declined to $7.8 billion (56.66 billion Chinese yuan) in the nine months to September, according to a stock exchange filing, as demand was slack while operating costs jumped with high energy prices and high crude oil price…FULL STORY
CHINA’S CNOOC IN NO HURRY TO EXIT NORTH SEA, BUT OPEN TO ATTRACTIVE OFFERS
Source: S&P Global
CNOOC receives offers for North Sea assets
Willing to talk to potential buyers amid high crude prices
Realized liquid prices jump 56% on year in nine-month period
China’s state-run CNOOC is open to discussions with potential buyers interested in taking over its oilfields in the UK’s North Sea, but the offshore giant is not in a rush to exit the region and any sale would depend on an attractive valuation for its shareholders, company CFO Xi Weizhi said Oct. 27…FULL STORY
OIL NEAR FLAT, INFLATION WORRIES COUNTER POTENTIAL BOOST IN CHINA DEMAND
Source: Reuters
Oil prices were near flat during a choppy trading session on 20 October, as worries about inflation dampening demand for oil contended with news that China is considering easing COVID-19 quarantine measures for visitors.
Brent crude futures rose 14 cents to settle at $92.57 a barrel. U.S. West Texas Intermediate crude for November delivery, which expires on Thursday, rose 16 cents to $85.71 per barrel. WTI for December delivery edged down 1 cent at $84.51 per barrel. Both Brent and WTI earlier gained by over $2 per barrel…FULL STORY
ORDERS FOR LNG CARRIERS SURGE ON BACK OF DEMAND
Source: China Daily
With burgeoning demand for liquefied natural gas, new orders for LNG carriers have recorded significant jump recently, Securities Times reported.
According to data provided by market tracker Clarksons Research, at the start of October, the order book of LNG carriers stood at a record high of 128. Between 2018 and 2021, the trading volume of new LNG carriers in the world reached 77, 60, 53 and 86, respectively…FULL STORY
CHINA STILL ADDED TO CRUDE OIL INVENTORIES DESPITE REFINING, FUEL EXPORT SURGE
Source: Hellenic shipping news
A rebound in China’s refinery processing and fuel exports in September was still not enough to prevent the world’s biggest crude oil importer from adding to its stockpiles.
China’s refineries processed the equivalent of 13.88 million barrels per day (bpd) of crude oil in September, the highest in nine months and the first year-on-year increase since November 2021…FULL STORY