• 5 minutes Covid-19 logarithmic growth
  • 8 minutes Why Trump Is Right to Re-Open the Economy
  • 12 minutes Charts of COVID-19 Fatality Rate by Age and Sex
  • 14 minutes China Takes Axe To Alternative Energy Funding, Slashing Subsidies For Solar And Wind
  • 1 hour Cpt Lauren Dowsett
  • 2 hours Trump will meet with executives in the energy industry to discuss the impact of COVID-19
  • 13 mins Its going to be an oil bloodbath
  • 27 mins Marine based energy generation
  • 14 mins What If ‘We’d Adopted A More Conventional Response To This Epidemic?’
  • 5 hours Which producers will shut in first?
  • 3 hours How to Create a Pandemic
  • 3 hours CDC covid19 coverup?
  • 3 hours Iran-Turkey gas pipeline goes kaboom. Bad people blamed.
  • 24 hours Pumping Dollar V Pumping Oil Match
  • 21 hours The Most Annoying Person You Have Encountered During Lockdown
  • 14 hours The idea that electric cars are lowering demand is ridiculous.
  • 15 hours Russia's Rosneft Oil Company announces termination of its activity in Venezuela

Breaking News:

IEA: OPEC Can’t Save The Oil Market

Alt Text

Are We Really Facing A Battery Metal Shortage?

Electric car builder Tesla foresees…

Alt Text

Investors Return To Plowing Money Into Commodities

Commodities are trending once again…

Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Premium Content

A Wave of Steel

China is the key to the metals markets today. And there are some important signals about this market registering in the last few weeks.

Last month, I wrote about diverging global shipping indexes. The Baltic Dry Index, which tracks global shipping rates, has been falling the last several weeks. While the China Containerized Freight Index, tracking solely Chinese shipping prices, has been on a tear. The CCFI is up 12% since the beginning of January.

This could indicate an increase in goods being shipped out of China these days. And those goods might be metals. A few weeks ago, odd shipments of aluminum started showing up at ports in northwest Japan. Speculation is these sailed from Shanghai.

If China is indeed starting to re-export its vast stockpiles of metals built over the last year, there are major implications for prices. There is a lot of supply that could "hit the street" in a hurry.

Some more evidence of re-exports emerged last week.

The European Commission reported that Chinese applications for steel imports into Europe were up 50% in January, as compared to December 2009. Chinese exporters applied to send 244,000 mt of steel into Europe.

Overall, China accounted for 16% of total import applications during the month. The first time in over a year that China represented the largest volume of import orders.

These applications don't guarantee shipments will be made. Exporters are under no obligation to actually send the amount of capacity they apply for.

But this is a development to watch. If these exports do materialize, they represent a large wave of steel breaking over world markets. Running contrary to the conventional wisdom that rampant development in China is sucking up any raw materials the nation can get its hands on.

If China isn't using as much steel as we thought, what's happening to stockpiles of copper, coal and iron ore?

By. Dave Forest of Notela Resources


Download The Free Oilprice App Today

Back to homepage






Leave a comment
  • Anonymous on February 24 2010 said:
    Good story and a great heads up to producers and investors.
  • Anonymous on February 24 2010 said:
    Please keep us posted. Great article.
  • Anonymous on February 25 2010 said:
    What about Gold and Silver?
  • Anonymous on February 25 2010 said:
    Any chance they're shipping overstocks and making gains? We know there are building halts so it does raise questions about new demand. But I'm wondering if they bought low...made some deals in Europe, then ship some tonnage every once in a while without crashing prices. Then build up stocks again at slightly lower prices later?

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News