Executive Summary
USA
1. (From June 20). APEX Act continues to gain traction, nineteen lawmakers pushing for it.
In the last week, three more lawmakers signed as cosponsors of the APEX Act. A total of nineteen lawmakers are now cosponsoring the APEX Act, with three of them adding their support in the past week: Rep. David Scott (D-GA), Rep. Scott H. Peters, (D-CA), and Rep. Ben Cline (R-VA). These three new lawmakers join the Act’s sponsor Rep. Al Lawson Jr. (D-FL), the original cosponsor Rep. Ken Buck (R-CO), and fourteen other bipartisan lawmakers from the states of California, Colorado, Virginia, Florida, Wisconsin, Georgia, Idaho, Ohio, Texas, and Washington.
More details in full report.
2. (From June 18). US billet spot upcharge plummets to lowest levels since January 2018 amid weakening demand and increased supply.
HARBOR’s US billet spot upcharge delivered for well-known/traditional suppliers fell today to 8.0–11.0 cent/lb from 10.5–12.5 cent/lb. Similarly, HARBOR’s US billet spot upcharge delivered for nontraditional suppliers fell today to 7.5–10.0 cent/lb from 8.5– 11.5 cent/lb.
More details in full report.
EUROPE
3. (From June 19). European primary billet plants face critical deadlines.
Alcoa has reached agreement in principle to sell Aviles and La Coruña plant to Parter Capital Group (Swiss fund), just in time before the June 30 pre-agreed deadline before further layoffs, pre-retirement, and internal employee relocations take place, along with the definitive closure of the electrolysis production at both plants. However, full Aviles and La Coruna smelting restarts are not expected in the short term as high energy costs are an outstanding issue that still needs to be solved with the Spanish government. Conversely, Bosnia’s Aluminij primary billet production remains at risk as its power supply ends late this month, which seems to be pushing the company to talk with a major trading company to potentially help them avoid bankruptcy. We understand Aluminij produces about 50 kmton of billet per year.
More details in full report.
LATIN AMERICA
4. (From June 19). Mexican billet buyers out of the market for Q3–Q4, premium offers fall below $335 per mton FCA Veracruz
Our intel from the ground indicates almost all major domestic billet buyers will be out of the contractual market for the balance of the year. In the same vein, spot billet activity is basically nil. As we promptly reported the Mexican market seems long billet, P1020 and scrap, at a time when at least a couple of consumers are favoring internal cast house production and lowering their third-party billet intake. According to our visibility, there has not been recent relevant spot or quarterly deals in the Mexican market for a while now. That is the reason why our spot assessment is still at $340– $360 per mton. Nevertheless, recent offers for 6063 full billet premium FCA Veracruz or Manzanillo stands at $330–$335 per mton.
More details in full report.