(by Paul Vivian and Rick Preckel, www.prestonpipe.com) Market Monitor – Nucor Steel announced on December 13, 2021 that they had entered into an agreement with Brazilian mining company Vale S.A. to purchase that company’s 50% stake in California Steel Industries. They also announced an agreement to purchase a 1% share of CSI from JFE Steel Corporation giving Nucor Steel a majority ownership position in CSI. Nucor intends to operate the company as a joint venture with JFE; their second such operation. The purchase includes the pipe mill operations which is why we are mentioning it here. The question our line pipe readers may have is what does this mean for the CSI pipe mills. Nucor has certainly become a more significant player in the pipe and tube sectors but some of the challenges with location and material sourcing remain. Since the beginning of 2020 the large diameter market has been in the doldrums. In the chart at right, large diameter line pipe imports are presented from the beginning of 2009 through November 2021. What is not evident in the presentation is the fact that the market was actually better in 2020 than in 2021. That is evident in the chart at the bottom of the page. In 2020, import share was about 16% of the market but as HRB prices increased starting in August 2020, import share increased averaging 40% so far in 2021. Import Supply – The October import total was 69,060 tons which was 20% above the license tally from last month. November import licenses show a further increase in volume to 87,079 tons. The December forecast, with 9 of 21 days summed, is steady at 80,711 tons. The top import item for the month of October 2021 was carbon ERW 4 ½” not over 16” OD at 34,743 tons. The price was $1,304/ton. This is up $206/ton and $306/ton respectively, over the last two months.
Preston Pipe Report – December 2021
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