Daily Pour






Date : 13/12/2018    Issue No. :1639/18-19



Compiled By :   Shyamal Aroskar, Dir.-WR 



                            B.Ramchandran, Chennai 



IIF News




Prestigious Two Days Conference of Western Region hosted by Rajkot Chapter at Rajkot

Theme : Global  Opportunites & Challenges
Date    : Saturday, 15th December & Sunday, 16th December, 2018
Venue : Hotel Seasons,
              Avadh Road, Opp. Drive-in Cinema,
              Kalawad Road, Rajkot - 360005

With Regards,



Shyamal Aroskar

Asst.Director IIF-WR




Thought of the Day



News Letter Supported By





Today's Top Raw Materials Headlines

*** Taiwanese container scrap dips while domestic rebar stablises

*** Indian Ferrous scrap traders unwilling to down the price

*** L&T will build the biggest alumina refinery in India

*** Indian Brass, Copper Scrap prices fall; Copper Futures gain 1.29 percent

*** Manganese flakes rise; selenium down by 3.6%

*** Indian Industrial output growth fastest in 11 months at 8.1% in October

*** High carbon ferromanganese prices down in China

*** Chinese magnesium ingot export prices decrease on slow demand

*** Chinese pet coke price up slightly


Raw Material News


Iron ore costs ricochet in spite of reports of harder steel creation controls in China

Iron ore costs bounced back on Wednesday, bolstered by quality in Chinese steel markets. As per sources, the spot cost for benchmark 62% fines skipped 1.2% to $66.73 a ton, snapping a four-day losing streak all the while. Unassuming increases were additionally observed crosswise over lower and higher evaluations amid the session. 65% Brazilian fines included 0.7%, shutting down at 83.40 a ton. The cost for 58% fines ascended by a littler 0.6%, settling at $42.42 a ton. The no matter how you look at it gains harmonized with reports that administration authorities in Tangshan, China's biggest steel making region, had requested mechanical firms, including steel factories, to additionally control decrease levels until the year's end so as to keep up satisfactory air quality gauges. As indicated by data, the administration requested mechanical plants to diminish yield by a normal of 40% until December 31. That may have added to an early flood in Chinese steel and mass item fates on Wednesday, the last coming regardless of the danger that bring down generation levels would almost certainly limit interest for crude materials. Solid additions were seen over every significant contract. Be that as it may, those increases couldn't be continued into the nearby with most contracts completing around indistinguishable dimensions from Tuesday's day session close.

Comparative patterns were seen in medium-term exchange on Wednesday with all agreements aside from hot-moved loop and coke fates completing at comparable dimensions to 24 hours sooner. Unassuming additions were accounted for somewhere else. SHFE Hot Rolled Coil ¥3,693, 0.85%, SHFE Rebar ¥3,671, 0.08%, DCE Iron Ore ¥512.00, 0.59%, DCE Coking Coal ¥1,436.00, 0.45%, DCE Coke ¥2,391.00, 1.40%.

The blended execution from fates gives couple of insights regarding how spot markets will admission on Thursday.


Iranian semi-finished steel prices continue to slide on sanctions, dwindling demand

Iranian export billet and slab prices continued to fall this week, with sanctions leading suppliers to cut offers, but with little success. Billet offers from Iran were heard at $395-405 per tonne fob, depending on the producer, down from $405-412 per tonne fob last week. However, most customers have held back from purchasing Iranian material.


Metals quiet, awaiting trade developments

Three-month base metals prices on the London Metal Exchange were for the most part firmer this morning, Wednesday December 12, with average gains of 0.3%. This after the complex climbed by an average of 0.4% on Tuesday, which followed Monday’s test of support levels – that held.

This morning’s gains were fairly tightly bunched with prices rising between 0.2% for aluminium and 0.6% for nickel. The exception is zinc where prices were off by 0.2%. Copper was up by 0.3% at $6,167 per tonne.

Volume across the complex has been low, with 4,047 lots traded as at 7.19am London time.

With some of the concern in broader markets easing and with the dollar firmer, gold prices have pulled back from recent highs and were recently off by 0.1% at $1,242.26 per oz. Silver and palladium were little changed, while platinum prices that had been under pressure were up 0.4% at $786.90 per oz.

In China this morning, the base metals prices on the Shanghai Futures Exchange were for the most part firmer, the exception was the February aluminium contract that was down by 0.4%. Of the rest, January lead was up by 0.8%, February zinc and copper were up by 0.3% and 0.2% respectively with the latter at 49,120 yuan ($7,112) per tonne, while May nickel and tin were both little changed.

Spot copper prices in Changjiang were little changed at 49,170-49,450 yuan per tonne and the LME/Shanghai copper arbitrage ratio was weaker at 7.97 after 8.00 on Tuesday.

In other metals in China, the May iron ore contract on the Dalian Commodity Exchange was up by 0.4% at 474 yuan per tonne. On the SHFE, the May steel rebar contract was up by 0.8%.

In wider markets, spot Brent crude oil prices were up by 0.54% at $60.78 per barrel. The yield on US 10-year treasuries has started to strengthen and was recently quoted at 2.8803%, but the yield on the US 2-year and 5-year treasuries remain inverted at 2.7671% and 2.7424% respectively. The German 10-year bund yield was weaker too at 0.2300%.

Asian equity markets on Wednesday were stronger: the Nikkei (2.15%), the Kospi (1.44%), the ASX 200 (1.39%), the CSI 300 (0.34%) and the Hang Seng (1.60%).

This morning’s performance follows a mixed performance in western markets on Tuesday; in the United States, the Dow Jones Industrial Average closed down by 0.22% at 24,370.24, while in Europe, the Euro Stoxx 50 was up by 1.27% at 3,055.32.

The dollar index rebounded on Monday and pushed even higher on Tuesday and this morning it is quoted around at 97.42 – the high this year being 97.70. The rebound in treasury yields are providing support. The other major currencies we follow are mixed; the euro was weaker at 1.1328, the Australian dollar was flat at 0.7210, the yen was weaker at 113.40, while sterling (1.2498) has slumped on the back of a no-confidence vote against UK Prime Minister Theresa May.

The yuan is firmer this morning and was recently quoted at 6.8874, helped by some positive steps in US/China trade talks, with China’s decision to cut tariffs on import US cars to 15%, from 40% and Canada granting bail to Huawei’s chief financial officer Meng Wanzhou. Most of the other emerging market currencies we follow are either weaker or flat due to the firmer dollar.

Key data on the economic agenda today includes Italian quarterly unemployment rate, EU industrial production as well as US releases that include the consumer price index (CPI) and crude oil inventories.

Base metals prices remain rangebound with nickel and aluminium sitting in low ground and looking vulnerable, while the rest are holding up in high ground, with tin the only one looking to be attempting another move higher. So for now it is more of the same - although there may be a race on between whether the trade dispute is resolved before the global economic data deteriorates to the extent that it also becomes more of a negative factor.

Industry News


Uncertainty to determine fate of steel industry for 2019

Mr Sushim Banerjee DG of INSDAG in his personal capacity wrote in FE that during the first 8 months of the current year, the total imports of finished steel by India have gone down by only 2.3% compared to the previous year, while exports have fallen by around 35%. During the first 11 months of 2018 (including January and February prior to the duty imposition) US steel imports have reached around 29 million tonne which is nearly 10.4% lower compared to the previous year.

It appears that the expectation of a prolonged turnaround in the global steel market fuelled by consumption growth, higher levels of production and capacity utilisation and rising steel prices has been cut short and the happenings in the next few months on which there is a great deal of uncertainty would determine the fate of steel industry for 2019 and beyond that.

For the global market, the uncertainty revolves around the sustainability of the stimulus measures initiated by China (property market and road connectivity), Japan (ports), South Korea (shipbuilding), Indonesia (housing) Italy (industrial reforms), Mexico and Canada (foreign trade), the US (infrastructure building), West Asia (infrastructure), Vietnam (roads and ports) and South Africa (housing).

The impact of growing tension in merchant trade following imposition of additional tariff on steel and aluminium by the US, the retaliatory measures adopted by China throttling the future of US investment in China and vice versa have caused significant tremor in the stability and efficacy of global steel trade. The uncertainty has particularly hurt the export oriented nations like Japan, South Korea, Turkey, Germany, Vietnam and Africa. It is interesting to know how the imposition of duties under Section 232 has helped the US to get over the scourge of unabated flow of cheap imports and rejuvenation of US manufacturing sector and unemployment problem during the last 8 months.

During the first 11 months of 2018 (including January and February prior to the duty imposition) US steel imports have reached around 29 MT which is nearly 10.4% lower compared to the previous year. South Korea, Japan and Germany, the primary exporters to the US have shipped 2.4 MT (down by 25%), 1.2 MT (down by 8%) and 1.1 MT (down by 6%), respectively to the US during the period. It was envisaged at the time of imposition of the Section 232 notification of US Trade Act that the US would be able to restrict steel imports from the existing level of around 34-35 MT to 22 MT in order to gain the full advantage of restricting cheap imports by additional duty imposition. Does it mean that US would continue to impose additional tariff of 25% on steel for some more years? It is pertinent to mention that the recent proposal of signing a new agreement superseding the NAFTA, tentatively called USMCA, is not going to benefit the energy sector without removing the tariff barriers which does not seem to be a part of the proposed agreement. The latest closure by General Motors plant in the US adding to the unemployment by a few thousands more in the US and Canada is a case in point. WTO has already referred the matter of tariff imposition by the US under Section 232 of US Trade Act to dispute settlement body as proposed by EU, Japan and India with the definite knowledge that there is no guarantee that the US would abide by the DSB conclusions if these are found to be at variance with US notification.

The PMI for manufacturing in the US for the last 3 months are 55.6 in September 2018 followed by 55.7 in October and 55.3 in November. The order flow is good, rising domestic prices have led to raising the manufacturing wages, but the business confidence is poor on account of uncertainty on the regular order flows. Available reports suggest that manufacturing productivity in the US is gradually improving. The current unemployment rate in the US at 3.7% has come down from 4.5% reached a few months earlier.

Thus, in overall analysis it is seen that while the US economy has gained somewhat positively in post duty imposition, its neighbours and the trading partners are disappointed and aggrieved. The target country for the US action was China which has retaliated with fresh duty imposition on $200 billion worth of US exports to China and the two countries would hurt each other (investment projects, MNC units, equity investment, among others) if the ripple effect of the duty and its aftermath is not addressed urgently by both the countries. The point is it is not purely economic or business or trade. It also involves relative political strength, opportunities and challenges.

For India, the exports diverted from the US by South Korea and Japan have found new destination in India as imports from South Korea to India in first half of the current fiscal was 9.7% more (25% less to the US compared to last year). During the first 8 months of the current year, the total imports of finished steel by India have gone down by only 2.3% compared to the previous year, while exports have fallen by around 35%. Thus India negates the decoupling theory and is affected by the US trade actions. WTO has ruled against India’s imposition of Safeguard Duties on the petition filed by Japan. It is unfortunate that a powerful economy gets away with higher duty imposition while India is charged with violation for resorting to a perfectly WTO complaint measure to arrest cheap imports. WTO must prove its independent platform more vigorously than ever.

Source : Financial Express


New Industrial Policy to be comprehensive

Anand Singh Bhal, Principal Economic Adviser, DIPP, said here today that the New Industrial Policy, to be announced soon, will address the challenges faced by the manufacturing sector encompassing of adoption of standards and quality control to impart competitiveness and take Indian manufacturing to the next level of technology to make the country's industrial base strong.

Speaking at the 'India - Korea Technology & Education Exchange Forum' organised by FICCI jointly with Korea India Business Centre (KIBC) and Korea Productivity Center (KPC), Bhal  said that India has moved from an agrarian economy to service dominated one.  The manufacturing sector has lagged and the time is opportune to give primacy to this sector. "India is not a very strong manufacturing nation and only contributes to 16 per cent of our GDP which is not very good," he added.

Under the 'Make in India' initiative, the Government of India aims to increase the share of the manufacturing sector to the gross domestic product (GDP) to 25 per cent by 2022.

He also said that India had a lot to learn from South Korea in terms of innovation in the manufacturing sector and creating a robust industrial base. The learnings and their implementation will also create large avenues for employment, the burden of which is currently borne by the services sector.

Dr Amita Prasad, Director General, National Productivity Council (NPC), said that NPC plays a key role in promoting productivity by harnessing the strengths of technology in education. The government has planned to develop five incubation centres for Internet of Things (IoT) start-ups as part of Prime Minister?s plan of 'Digital India' and 'Start-up Campaign' with at least two centres to be set-up in the rural areas to develop solutions for smart agriculture.

She said that both India and Korea can partner on India?s flagship initiatives such as 'Make in India', 'Skill India', 'Digital India', 'Start-up India' and 'Smart Cities Mission' and added that NPC had already singed a MoU with KPC and KIBC and these MoUs could be leveraged to deepen the partnership. 

Dr Noh Kyoo Sung, Chairman & CEO, Korea Productivity Center, said that Korea's Fourth Industrial Revolution sought to implement the intelligence innovation project on a large scale. The Fourth Industrial Revolution will be a golden opportunity for Korea as software is the core technology serving as the convergence of every industry.

Dr Pankaj Mittal, Additional Secretary, University Grants Commission (UGC), highlighted the various schemes and projects initiated by the government in up-scaling India's higher education to bring it to international levels.

Mincheol Kim, Minister Counsellor, Embassy of Republic of Korea, laid emphasis on developing the education system by creating synergies between India and Korea. "Both of us together are imperative than necessary in the education sector," he added.

Som Mittal, Chairman, FICCI Electronics & White Goods Manufacturing Committee, said that while India and Korea have strong business relations, it is also time to combine the human capital to make it much stronger, especially in the education sector as human capital resource will play an important role in the future


Life Style.........

Coffee compounds can help combat Parkinson's: Study

Combining two compounds found in coffee can act as therapeutic against Parkinson's disease and Lewy body dementia -- the two progressive and currently incurable diseases associated with brain degeneration, say researchers. 

The study, led by a team from the Rutgers University, found that caffeine, which traditionally has been credited as coffee's special protective agent, together with another compound found in coffee beans' waxy coating, slowed down brain degeneration in mice. 

The new coffee bean compound called EHT (Eicosanoyl-5-hydroxytryptamid
e) was found to protect the brains of mice against abnormal protein accumulation associated with Parkinson's disease and Lewy body dementia. Lewy body dementia is the second most common type of progressive dementia after Alzheimer's disease. 

"EHT is a compound found in various types of coffee but the amount varies. It is important that the appropriate amount and ratio be determined so people do not over-caffeinate themselves as that can have negative health consequences," said lead author M. Maral Mouradian, Professor at the varsity. Prior research has also shown that drinking coffee may reduce the risk of developing Parkinson's disease.

In the study, published in the Proceedings of the National Academy of Sciences, the team found that EHT and caffeine alone were not effective. However, when given together, they boosted the activity of a catalyst that helps prevent the accumulation of harmful proteins in the brain. Current treatments address only the symptoms of Parkinson's disease but do not protect against brain degeneration, according to the study. 

Further research is needed to determine the proper amounts and ratio of EHT and caffeine required for protective effect in people, said Mouradian.


Jokes All the Way......



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