GLG News by Mr. James May, Managing Director
GLG News is now G+ Insights
-
G+ is a community for professionals, academics and entrepreneurs to connect through online discussions and in-person meetings. You will continue to see G+ Insights (formerly GLG News) here as well as on the G+ website, where you can share and discuss the G+ Insights you read.
-
Very bullish for iron ore in 2008, not so for 2009
October 19, 2007
China's continued steel demand bolsters iron ore prices, miners | online.wsj.com
Contract prices likely to soar in 2008 Rising supply and weaker demand may lead to weakness in 2009
-
US industry gets ongoing protection from Chinese and Indian HR coil imports
October 11, 2007
ITC to keep duties on some imported steel | www.chicagotribune.com
US steel industry gains direct benefit from market protection against the major sources of potential over-supply over the next five years. This won't insulate the industry entirely due to a spillover effect. ArcelorMittal illustrates its phenomenal lobbying power and this has to be a success for this company.
-
Trash talk prior to price negotiations
October 11, 2007
GM looks to substitute materials to reduce costs: Purchasing VP calls price increases "scary" and outlines upcoming plans | www.purchasing.com
This "announcement" is not about substitution, it is about upcoming contract negotiations with its steel suppliers, and an attempt to influence the agenda to offset the supplier power of the steel industry. Substitution is occuring, and will continue to occur (even towards steel and aluminium) but it is not fundamentally price-driven and is not a short-term development. Magnesium has potential and is growing in terms of penetration, but price and performance mean that it has a limited role.
-
Consolidation alone will not reduce volatility
January 29, 2007
Will consolidation cut volatility in steel prices? | news.moneycontrol.com
Pricing volatility has not been reduced. US HR coil prices have just dropped $150/ton (25%) in the last six months and could easily go up by the same amount in the next six. The difference is that the bottom of the current cycle is above most producers' cost level.
The theory is that consolidation will reduce price volatility as producers can reduce supply to meet demand, without the fear that others will simply supply in their place (i.e. no free-riding). That assumes a closed system. An open trading system is not closed by definition and even if the industry is consolidated on a continental level, it is not consolidated globally.
Consolidation has yet to be tested in a significant industry downturn. I would argue that consolidation in its current form will be useless in preventing prices going below operating costs in the event of a serious reduction in global demand, without an increase in protection. -
Indian steelmakers risk over-expansion
January 11, 2007
India Raises Forecast for Steel Consumption | online.wsj.com
Indian consumption was just over 30m tonnes of finished steel in 2005. To reach 200m tonnes by 2020 would require a compound growth rate in excess of 13% for a 15-year period. The previous 15 years has seen a compound growth rate of less than 5%.
Chinese consumption compound growth over the last fifteen years was 12%. Have Indian bureaucrats simply looked at the Chinese performance over the last fifteen years and said that we can do the same? If they have, then they could be setting themselves up for a fall. -
December 18, 2006
CSN outbids Tata for Corus | today.reuters.com
An examination of the recent major M&A activity in the steel market suggests that the majority of buyers have been companies with dominant shareholders.
These appear to have a higher appetite for risk than their publicly-traded brethren.
The result will be a fast dwindling band of listed steel companies with widely-dispersed shareholders, and those that are left will command a rising premium. -
October 10, 2006
Sheet steel prices are falling | www.purchasing.com
North American flat product steel prices have dipped in the last month as high inventories, a dip in demand from the automotive and white goods sectors and the continuous arrival of imports have resulted in service centers dropping their order levels. The first to respond were the second-tier mills that offered discounts to shift their steel, but the major steelmakers (Mittal-Arcelor, US Steel and Nucor) have also been forced to bring their prices down to the $600/ton level for HR coil (from peak levels of around $640/ton). The decline has been gentle for now, so will prices collapse sharply or hold their ground?
-
The Corus Bric Strategy - Why?
October 10, 2006
Tata Steel looks set to make bid for Corus | business.timesonline.co.uk
There has been a strong rumor that Tata Steel will bid for Corus. In the past, Corus management has stated that it is spending a considerable proportion of its time examining mergers – fair enough. However, most of those are reported to involve BRIC steelmakers, and I don’t understand why. It should make more strategic sense and create more value by a hook-up with a European steelmaker.
-
Evraz buys Highveld for vanadium not steel
July 14, 2006
Anglo to sell steel firm Highveld | today.reuters.co.uk
Evraz has bought Anglo's steel unit Highveld for its vanadium market access not its steel mill profitability.
Evraz will now control a significant part of the global vanadium market outside of China via its Russian operations, the Highveld mine plus the numerous Highveld joint-ventures with smelters plus its recent purchase of Stratcor.
This should be viewed as consolidation of the vanadium sector and a leveraged bet on vanadium prices and not steel industry consolidation. -
Impact of iron ore increase on steel mills
May 19, 2006
Steel mills face another big rise in price of iron | business.timesonline.co.uk
CVRD agreed a 19% increase in iron ore fines and a 3% cut in iron ore pellet for 2006 contracts.
The Chinese steel sector will be worst affected, while the Europeans and North Americans can be viewed as the winners. -
April 11, 2006
Evraz buys 73% of Stratcor | www.forbes.com
Evraz buys a dominant shareholding of US vanadium specialist Stratcor
Evraz is one of the leading suppliers of vanadium-bearing slag which is a raw material for vanadium supply but lacked the means to convert it to a finished product.
This acquisition allows it to do so.
It is likely to follow it up with further consolidation
This has a significant impact on the long-term pricing for vanadium and market supply structure.
Page : 11 to 11 of 11
- Subscribe to Updates
-
Leading institutions connect with James May through GLG
Most Popular Energy & Industrials News
-
Chesapeake Energy bites the natural gas bullet
January 25, 2012
-
Flurry of newbuild drilling rig deliveries in 2012 may dampen rig rates
January 20, 2012
-
Talisman joins the ranks of cautious E&P companies
January 12, 2012
-
Early signs of caution begin to cloud frontier exploration and production
January 4, 2012
-
It's too early in the game to write off Shtokman
December 8, 2011
Gerson Lehrman Group, Inc. connects communities with knowledge through two distinct, yet complementary offerings: GLG Research and G+.