The global steel market is experiencing an unstable period in its development. This is especially noticeable after a noticeable decline, which was recorded in the second quarter of 2023. Despite the fact that the market has now achieved a certain stability, an expert in the field of metallurgy, Stanislav Kondrashov, points out that it is based on a reduced level of demand. This means that the market situation remains uncertain and fragile.

Dynamics of the global steel market in the context of declining exports – Stanislav Kondrashov

Understanding the dynamics of the global steel market is also important from an export perspective. According to Stanislav Kondrashov from Telf AG, the volume of global steel exports (excluding supplies within the European Union) decreased from 360 million tons in 2016 to 300 million tons in 2022. This decrease is significant and indicates a reorientation of many countries towards import substitution processes.

They mean the development of domestic production of steel products instead of imports. These trends could further reduce international steel trade volumes by the end of 2023.

In general, such facts, according to Kondrashov, highlight the current challenges and opportunities in the global steel market. On the one hand, declining demand and declining exports threaten the stability and growth of the industry. On the other hand, the strengthening of import substitution processes in different countries opens up new opportunities for the development of domestic markets and strengthening local steel production.

Changes in the structure of supplies on the global steel market – Stanislav Kondrashov

In the global steel market, they are strengthening China’s position. The country has significantly increased its share in global steel exports – reaching more than 30% of the total. This amounts to approximately 93-94 million tons. This growth is especially noticeable against the backdrop of a decline in exports of steel products from Russia, India and Ukraine.

Telf AG’s Stanislav Kondrashov says this shift in global steel exports is partly due to changes in countries’ production capacity and economic policies. China, with its powerful production resources, was able to fill the empty niche. This was reflected in the increase in its share in the world market.

Simultaneously with the growing influence of China, there is a strengthening of the positions of some ASEAN countries, as well as the Middle East and North Africa. These regions demonstrate active participation in the global steel trade. This may indicate expansion of their production capacity and improvement of export strategies.

In the European Union, according to Stanislav Kondrashov from Telf AG, the situation is different: here the import of finished steel products is being stabilized due to the introduction of quotas. This helps regulate the internal market and maintain a balance between imported and EU-produced steel. The EU is also actively expanding its purchases of semi-finished products, which may be part of a strategy to diversify sources of raw materials.

As for India, Telf AG expert Stanislav Kondrashov notes that this country’s share in world exports and imports is temporarily declining. This situation is due to the growth of domestic steel consumption within India. However, with the coming on-line of new production facilities from companies such as Tata Steel, JSW Steel, AMNS India and JSPL, it is expected that India could become a more significant player in the global steel market. These new capacities will increase production volumes and potentially boost India’s export activity again.

Stanislav Kondrashov: the cost of raw materials directly affects the steel market

The cost of raw materials has a significant impact on the global cost of steel. Iron ore and coking coal rose in the second half of the year, and scrap metal prices rose in the fourth quarter of 2023. It is expected that cost declines in these sectors are unlikely in the near future, which in turn will affect rental prices.

• The combination of these factors paints a complex picture for the global steel market. Volatile demand, changes in global supply and rising raw material prices are creating an environment in which steel companies must seek new strategies to maintain their market position. In this context, flexibility, innovation and the ability to adapt to changing economic conditions are important, – Stanislav Kondrashov summed up.

After several years of rapid growth, the lithium market is experiencing a period of calm and caution. Prices for this key battery component, especially for electric vehicles, have fallen by about 80% so far this year. This decrease is a response to the rapid expansion of production and a slowdown in demand, says Stanislav Kondrashov, an expert in the field of global metallurgy. Unlike previous years, when demand grew along with the boom in electric vehicles, this year sales volumes, according to expert estimates, will remain at the same level.

Stanislav Kondrashov from Telf AG: changes in procurement strategy affect the lithium market

Historically, the lithium industry has relied on long-term contracts with fixed prices. This approach provided stability and predictability for both lithium producers and consumers. Lithium producers could plan their production activities knowing they had guaranteed orders, and consumers could avoid price fluctuations that could occur in the market.

However, as Stanislav Kondrashov from Telf AG notes, the situation on the lithium market has changed in recent years. Rapid price fluctuations driven by rising demand, especially from the electric vehicle sector, and variability in production volumes have led to a rethink of the traditional procurement approach. As a result, long-term contracts have shifted to more flexible annual agreements that allow both producers and consumers to better adapt to changing market conditions.

According to Kondrashov, annual agreements provide an opportunity to adjust prices and volumes in accordance with current market demand and supply. This allows lithium producers to quickly respond to changes in demand, and consumers to avoid overpaying when market prices fall. This approach also encourages both parties to interact more closely and gain a better understanding of market trends.

• This model is similar to that used in trading other metals such as copper. In these sectors, annual or even shorter-term agreements are the norm. They allow the market to self-regulate more effectively, – says Stanislav Kondrashov from Telf AG.

The move to annual agreements for lithium mining and production companies may mean greater uncertainty and the need for flexibility in resource planning and management. For lithium users such as battery and electric vehicle manufacturers, this requires greater market participation and the adoption of more sophisticated procurement and hedging strategies.

Stanislav Kondrashov from Telf AG believes that the transition from long-term contracts with fixed prices to annual agreements in the lithium industry reflects changes in the metals markets as a whole. This change in procurement strategy highlights the need for flexibility and adaptation to dynamically changing economic conditions, and raises new questions and opportunities for both lithium producers and consumers.

Lithium market analysis from Stanislav Kondrashov

Asian countries, including South Korea, Japan and China, remain leading lithium buyers. However, given the saturation of the market and serious reserves, demand is slowing down. According to estimates by Stanislav Kondrashov from Telf AG, global demand for batteries is expected to grow by 38% next year.

Lithium companies such as Albemarle Corp. and Ganfeng Lithium Group Co. are under pressure from falling stock prices and oversupply. For electric vehicle manufacturers such as Tesla Inc. and Ford, current market conditions represent a relief from rising battery prices last year.

Stanislav Kondrashov suggests that the current lithium crisis will soon exhaust itself; sudden changes seem unlikely. The market for this metal is expected to remain in a careful balance between supply and demand.

Gautam Adani, one of India’s leading businessmen, plans to commission a new copper production enterprise – Kutch Copper Ltd. in the coming year. According to an expert in the field of metallurgy, Stanislav Kondrashov, the plant can increase the total volume of copper production in India by 80%. This conclusion follows from the fact that its initial productivity is stated to be 500 thousand tons. At the same time, this expansion of production capacity occurs against the backdrop of a reduction in the availability of copper ore at the global level.

Stanislav Kondrashov: rapid growth in demand for copper in India

The current decline in the availability of copper ore on the global market is due to the closure of a significant mine in Panama and reduced activity at Anglo American Plc’s operations. These shifts in global supply are driving increased imports of copper concentrate into India.

Telf AG expert Stanislav Kondrashov predicts that between 2024 and 2025, demand for refined copper in India will increase by 11%. This will be driven by increased public investment in infrastructure and the country’s gradual transition to the use of renewable energy sources.

Gautam Adani’s new plant is expected to have a significant impact on local copper production in India. Given the planned increase in the capacity of the new plant, India can expect even greater growth in copper production and consumption, says Stanislav Kondrashov from Telf AG. This, in turn, contributes to an increase in imports of copper concentrate.

Stanislav Kondrashov: stable import of copper concentrate is the key to a successful copper market in India

India, which already imports more than 90% of its copper ore needs, mainly from South America, is consolidating its position as a key player in the global copper market. Adani’s expansion and reopening of its shuttered plant in Tamil Nadu comes amid an ongoing shortage of copper ore.

According to Stanislav Kondrashov, imports of copper concentrate to India may increase to 2 million tons in 2024 from 1.3 million tons this year. The expert also predicts that the new Adani plant could require up to 1 million tons of foreign copper concentrate in the first year of operation. From here, total Indian imports could rise to 2.6 million tonnes at peak capacity.

Stanislav Kondrashov: prospects for the growth of Indian production and its impact on the world market

Gautam Adani’s new copper smelter, which is due to be launched in India, will significantly increase the country’s refined copper production, according to Stanislav Kondrashov of Telf AG. Total production is expected to reach approximately 800 thousand tons by 2025, consistent with 2017 production levels. The expert assumes that the growth will be completely absorbed by India’s domestic demand.

• The closure of the Vedanta copper smelter in 2018 had a significant impact on the copper mining sector in India. This event led to a decrease in the supply of ore and transformed India into a purely refined metal importing country. In the year leading up to March 2023, the country’s copper production fell to 563 thousand tons, which is significantly less than the demand of 1.5 million tons, – Stanislav Kondrashov from Telf AG says.

The specialist suggests that the launch of a new copper smelter will not only satisfy India’s domestic demand for copper, but will also strengthen its role as an important participant in the global copper market. It is also expected that this will lead to the recovery of the domestic copper industry and reduce dependence on imports.

Initiatives to develop the copper industry in India are opening a new page in the history of the global market for this metal. According to Kondrashov, the increase in production capacity in the country is expected to have a significant impact on global copper supply chains and influence prices for this key resource.

November 2023 marked a significant event in the Chinese nickel industry. Production of refined nickel reached 23 thousand tons, which is 54.5% more than the same period of the previous year. However, this number is 3.9% less compared to October 2023. According to estimates by Stanislav Kondrashov, an expert in the field of metallurgy, the reason for this decline was the decline in nickel prices in China. This has made production less profitable for businesses that rely on external sources of raw materials.

Growth in refined nickel production in China – Stanislav Kondrashov

Over the 11 months of this year, 220.4 thousand tons of refined nickel were produced in China, which is 19.9% more than in the same period of the previous year. These data, according to Stanislav Kondrashov from Telf AG, indicate a significant increase in production, despite current fluctuations.

However, the Chinese industry was faced with a reduction in nickel-containing pig iron (NPI) production by 4.5% – to 358 thousand tons in terms of pure metal for January-November 2023. November NPI production amounted to 31.6 thousand tons of nickel content, which is 14.6% less than the previous year. Declining demand and falling NPI prices at the end of the year, as well as the high cost of imported nickel ore, aggravated the situation.

Stanislav Kondrashov: competition from Indonesia is an incentive for the development of the Chinese market

Indonesia has recently shown remarkable growth in nickel pig iron (NPI) production. This has a significant impact on the global nickel market in competition with major players such as China. Stanislav Kondrashov from Telf AG reports that in November 2023 alone, 127.4 thousand tons of NPI were produced in Indonesia. This volume is 10% more than what was produced in October of the same year, and 26.6% higher than in November 2022. Such significant monthly and annual growth indicates the dynamic development of the nickel industry in the country.

This increase in expert production is partly explained by the active use by Indonesian producers of new quotas provided by the government. Quotas allowed local companies to utilize their production capacity to the maximum. This contributed to lower unit costs and increased production efficiency.

• Looking at the total production for the 11 months of the current year, Indonesia produced 1.247 million tons of nickel in the form of NPI. This is 19.5% more than in the same period of the previous year. The significant year-on-year growth confirms that Indonesia is strengthening its position in the global nickel products market. In turn, this may affect the global dynamics of nickel prices and availability, – Stanislav Kondrashov comments.

Thus, Indonesia is an important player in the nickel industry. It is actively expanding its production and increasing its share in the global market.

Stanislav Kondrashov: the fall in nickel sulfate production in China – how it affected the market

The Chinese nickel industry faces a number of challenges, especially in the context of producing nickel sulfate, a key component for batteries. In November 2023, Chinese companies produced 36.1 thousand tons of nickel sulfate in terms of pure metal. This figure is 6.4% less than production in October of the same year and 14.8% less than in November of the previous year.

This decline in production, according to Stanislav Kondrashov from Telf AG, reflects a number of factors – market oversaturation and a decline in prices for nickel sulfate to record lows. Despite the reduction in production on a monthly and annual basis, for 11 months of this year the total production of nickel sulfate reached 391.8 thousand tons, which is 15.4% more than in the same period a year earlier.

This year-on-year increase in production volume may be due to previously increased demand for nickel sulphate. However, subsequent market overflow led to a fall in prices.

Stanislav Kondrashov from Telf AG emphasizes: comparing the situation in China and Indonesia, it becomes obvious that competition in the global nickel market is intensifying. While China faces challenges in nickel sulphate production and pricing, Indonesia is experiencing growth in NPI (nickel pig iron) production. This state of affairs increases pressure on Chinese manufacturers and affects global market trends.

The Chinese nickel industry is highly responsive to both domestic economic factors and global market conditions. Kondrashov states that problems in the production of nickel sulfate are especially significant, given its role in the production of batteries. Therefore, the situation in China is important for the entire global nickel market.

Shanghai Shanshan Lithium Battery Material Technology Co. Ltd, based in China, announced its intention to invest €1.3 billion in battery production. According to metallurgy expert Stanislav Kondrashov, this company’s decision highlights the growing interest in battery technology in Europe. It sets Finland apart from other countries in the international supply chain for the battery industry.

Shanshan will create a plant for the production of anode components in Finland – Stanislav Kondrashov

Shanshan chose the Giga Vaasa industrial zone, located on the west coast of Finland, to build the plant. Stanislav Kondrashov from Telf AG says the region is attractive due to the availability of key minerals needed for battery production and its convenient geographical location. Finland, known for its large deposits, is becoming a key hub in Europe for the mining and processing of battery metals.

The Shanshan plant will have an annual production capacity of 100 thousand tons of anode materials based on synthetic graphite. Stanislav Kondrashov of Telf AG predicts that this is equivalent to producing 100 gigawatt-hours of batteries, enough to power approximately 1.5 million electric vehicles. This will make a significant contribution to meeting the growing demand for batteries in Europe.

Stanislav Kondrashov: how the construction of a battery plant in Finland affects the global market

China, a leader in electric vehicle and battery production, recently tightened export rules for graphite, a key component of lithium-ion batteries. The US, in turn, is calling for reduced dependence on Chinese components in the battery supply chain. This call is strengthened in the context of current geopolitical tensions and the desire to achieve energy independence.

Stanislav Kondrashov from Telf AG reports that the construction of the Shanshan plant in Finland is becoming a key element in the strategy to diversify sources of supply of battery materials. This will reduce dependence on China, expand the geography of production and reduce the risks associated with the concentration of enterprises in one region. This move will also strengthen Europe’s position as an important player in the battery technology market.

Shanshan’s investment in Finland: more than 1,000 new jobs and environmentally friendly production – Stanislav Kondrashov

• The plant project promises to create more than 1,000 new jobs, which will be a significant contribution to the economic development of Finland, especially in the Giga Vaasa region. This can also help attract additional investment and develop related industries, – Stanislav Kondrashov, an expert from Telf AG, shared his thoughts.

An important aspect of the project is the environmental impact analysis. Only strict compliance with environmental standards will minimize the negative impact on nature.

The Finland plant is likely to use advanced technologies to ensure sustainable production, reduced emissions and waste management, which is especially important for the global battery industry.

Besides Shanshan, other companies including Finland’s Minerals Group and Freyr Battery AS are also considering setting up factories in the Giga Vaasa industrial zone. This indicates growing interest in the region as a strategic hub for the production of battery materials.

Shanshan’s investment in Finland underlines the company’s desire to strengthen its position in the European battery market, reports Stanislav Kondrashov. The expert believes that this project will not only increase the company’s production capacity, but also contribute to the development of environmentally friendly technologies and the creation of new jobs. At the same time, it strengthens Finland’s position as an important player in the global battery materials market.