Recently-released financial results from Europe’s stainless steelmakers painted a predictably grim picture. With nickel prices, and thus stainless steel prices, falling, large-volume buyers have had little appetite to restock, instead waiting for a clear bottom in prices. The pernicious effects of deflation in action.
That said, Aperam appears to be outperforming its peers this year. Why is this?
Continue reading Brazil the redeemer
With commodity prices dropping sharply over the past 15-18 months, many economies have been hit hard. Oil-rich Saudi Arabia issued its first government bonds since 2007 earlier this year as it looked to cover a widening budget deficit caused by the collapse in oil prices, while commodity-dependent Brazil and Russia have entered outright recession this year.
It is the latter of these countries that is the focus of this article, and in particular Russia’s steelmakers. How have they coped with the significant falls in domestic GDP this year, of some 3.5-4%, as well as a sharply weakened currency and a large jump in inflation and interest rates?
Continue reading Russian steelmakers benefit from rouble weakness
A recent article in The Economist highlighted the problems being faced by US manufacturers in the face of a strengthening dollar.
Indeed, with economic data for Europe increasingly surprising on the upside so far this year, and that of the USA increasingly disappointing, there are ever more questions over whether the positive economic data coming out of Europe is merely coming at the expense of that in the USA following the large shift in value of each region’s currency.
Put simply, US goods have become much more expensive in overseas markets while European goods have become relatively cheaper.
A look at the world’s tinplate industry, which has shown little-to-no global growth over the past decade, suggests that growth in one region at the expense of growth in another is very much a real phenomenon.
Continue reading US tinplate industry in trouble