Group items tagged

Steel Dynamics and LaFarga Group, the U.S. carbon steel producer and the copper semis manufacturer respectively, have announced a joint venture that will operate under the name, SDI LaFarga. The new company will produce copper wirerod by processing copper scrap as its primary raw material. Plans also include a $39M facility that the parent companies anticipate to be located in Allen County, Indiana.

The EU announced a 'Connecting Europe Facility' initiative on 19th October, which has substantial potential to boost European wirerod demand. As part of the €50B (US$69.5B) investment initiative, the EU plans to invest €9.1B (US$12.7B) in energy infrastructure, including renewable energy generators, smart meters and smart grids, and €9.2B (US$12.8B) in telecommunications and ICT.

According to data from the Copper and Brass Servicenter (CBSA), shipments from US brass and copper mills fell 8.6% m-o-m in November, to 20.5Mlb (9,300t). The organisation said that total shipments in the first 11 months of the year were broadly unchanged from 2011, at 244.8Mlb (111,000t). A breakdown of the figures reveals that copper sheet and copper wirerod saw the smallest declines in the month, -5.2% m-o-m and -5.3% m-o-m respectively, whilst brass sheet was the worst performing sector recording an output drop of 11.7% m-o-m. In a survey released with the data, 83% of respondents said they expected orders to increase in the coming 3 months.

On 1st November, Furukawa Electric Company announced further details about plans to increase profits by JPY18B (US$226M) by 2015. The company aims to do this through consolidation of their copper wirerod and optical cables division and pulling out of some areas including winding wire. The company will also move production of copper foil and electric wires overseas. Furukawa Electric cited the mature Japanese market and limited opportunities for growth in this market as reasons for the restructuring.

Nexans, the large French wire and cable maker, announced that it has won a EUR80M (USD104.5M) contract to supply and install a 100km long high voltage direct current (HVDC) submarine cable in Newfoundland, Canada. The cable will form part of a new HVDC transmission link in Canada that stretches 1,100km. The submarine cable, which uses copper wire as its conductive core, will be manufactured in the company's NVC factory in Tokyo. The announcement is the second large submarine cable contract the company has won in the last 3 months, following the announcement that Nexans won the contract to supply and install a EUR300M (USD387.4M) submarine cable connecting Italy and Montenegro in late October 2012.

Jinchuan Group began construction of its 300,000t/y continuously cast copper rod and rolled products operation. The company is China's third largest producer of refined copper, with a reported capacity of 600,000t/y.

Quanwei (Tongling) Copper Technology Co. Ltd., a subsidiary of the copper wirerod and wires producer, Hong Kong Zhangwei International Group Company, recently begun installation of a second phase of new production lines at its facility in Tongling Economic and Technological Development Zone. The company completed the first stage of copper semis processing units in 2009 and upon completion of the new expansion, the factory will have capacity to produce 120,000t/y of copper wire, 30,000t/y of fine copper wire, 600,000km/y of special cables and 50,000t/y of polymer material. Quanwei (Tongling) expects to achieve revenues of RMB12.0B once the operation is producing at full capacity.

It is believed that a cash crunch is reducing orders in the Chinese power sector, which accounts for 60% of the country's copper demand. Analysts predicted strong copper demand in H1 as the country was eager to repair the damages to power networks caused by the heavy snow in the early part of the year. However, repairs have so far mainly been made to aluminium and fibre-optic cables. Cash flow problems at copper rod and wire plants have occurred following the government's tight credit policy and high copper prices. Some 30% of copper wirerod production capacity is being reported idle. The cash shortages have also delayed copper buying from active copper fabricators, further dampening consumption of the metal. China, a net importer of copper, exported 31,000 tonnes of refined copper in April, up 227% year-on-year, with the possibility that the country might have been re-exporting the metal since late February. China's General Administration of Customs reported that 14,000 tonnes were exported to South Korea, six times that from the same period last year. This perhaps confirms that traders were re-exporting copper it has imported to LME-approved warehouses to take advantage of the discount between Shanghai and LME copper prices.

Neans focuses on "priority markets"

In the past few days world leading cablemaker Nexans has announced one acquisition, one new joint venture and one asset disposal. On the 30th May, Nexans acquired Intercond a leading Italian manufacturer of special cables for industrial equipment and subsea applications. The company had sales of €90m and employs 150. "This [€90m] acquisition fits totally in the Group's strategy by increasing the proportion of its business in high value-added special cables", said Gerard Hauser, Chairman and CEO of Nexans. On the 2nd June, Nexans released a press report confirming that it has formed a joint venture to create a wire and cable plant in Qatar, the country's first manufacturing facility. Qatar International Cable Company (QICC) is owned 29% by Nexans with the balance being owned by Special Projects Company and Al Neama Industrial Co. The new plant in the industrial city of Mesaleed, 40km from Doha, and will employ 210 people. By the end of 2009 it will begin manufacturing low and medium voltage cables for buildings and energy infrastructure as well as special cables for the oil and gas industry. This JV will generate sales of $150m per year by 2010 at current copper prices. Finally, Nexans confirmed that it has completed the pre-announced sale of its copper telecom cable plant at Santander in Spain to the British company B3 Cable Solutions for €17m. These three actions continue to refocus the group's strategy on priority market segments.

According to CRU's forecasts presented at the 9th World Copper Conference in Santiago, global copper consumption in 2009 is expected to fall by 2 to 3 million tonnes. This represents a 15-20% y-o-y plunge compared with 2008. The severe contraction is attributed to the global economic crisis and the freefall that many industries, such as the automotive sector, have experienced. In the first two months of 2009 total consumption of copper and copper alloy semis declined by 32% y-o-y, while that of copper wire and wirerod fell by 25% y-o-y. In the same period, insulated wire and cable decreased by 30%.

China Customs announced that exports of copper semis fell by 1.3% y-o-y to 259,470t in H1 2011. Exports of copper wirerod and profile were down by 14.8% y-o-y to 3,900t in the same period. The fall in exports is considered to be the result of weak demand from Europe and the US as well as Chinese producers' shift to higher added value copper semis.

Aurubis AG, a leading producer of unwrought copper and copper semis, announced its third quarter results. It reported pre-tax profits to have risen by 41% y-o-y to €111M and total net revenues of €3.294B, up by 32% y-o-y. The company produced 198,000t of copper wirerod, down by 6% y-o-y, whereas production of copper shapes was up by 10% y-o-y, amounting to 55,000t. Within this area, Aurubis' product mix is characterised by an increasing proportion of speciality products. The company noted cooling demand for its copper products during April to June 2011, attributed to seasonal factors.

SWCC Showa Holdings Co., Ltd, the Japan-based cable and systems manufacturer, announced plans to construct a copper wirerod plant in China during fiscal year 2012. The new factory, which will have an annual capacity of 60,000t, will be located in Tianjin. Investment is expected to reach RMB1.0B - RMB1.5B. In China, high-quality copper wire is in demand because it is used in winding wire assembling, primarily for automobiles. The company said it also plans to invest RMB1.5B in adding equipment to its factory in Zhejiang to double annual capacity there to 60,000t.

To improve streamlining and strengthen businesses in China, SWCC Showa Holdings is to increase capital investment by US$83.5M - an increase of around 60%y-o-y, the company said. Broken down, this will be an increase of around 75-80% for domestic investment and around 20-25% for overseas investment. Domestically the company said it will focus on streamlining to strengthen profitability; improving the productivity of electric wires for construction and electric power fields and replacing production lines for fibre optic cables. The overseas investment will be to increase the capacity for growth markets such as copper wire rods and industrial electric wires, the company said.

SWCC Showa Holdings Co., Ltd. announced it has established Hangzhou Fortis Showa Wire Materials Research & Development Co., Ltd., a fifty-fifty joint venture subsidiary for analyzing materials with Fortis Group Co., Ltd., a leading manufacturer of communication cables in China. The subsidiary will be employed to locally procure raw materials for copper wirerod and cable for use in photovoltaic systems they will manufacture in China. It aims to strengthen cost competitiveness whilst also securing quality.

Antaike reported that most Chinese copper semis fabricators orders decreased in June 2011 from the previous month. Copper commercial tube, copper wire and copper wirerod output rose 10% y-o-y in H1 2011. However, output growth of copper sheet and strip in the same period was weaker. Semis fabricators' profits fell attributed to high finance costs and high copper prices. These factors have also affected refined copper consumption.