[MonteQuest]

It looks like China may cause more than peak oil. What an energy, commodity hungry monster they are becoming!

Steel-guzzling China puts world's auto industry on edge

$this->bbcode_second_pass_quote('', 'T')OKYO (AFP) - Nissan's unprecedented decision to temporarily cut output due to a lack of steel shows how extreme the world's supply problems have become as China's huge economy consumes more and more basic materials. China last year accounted for more than 25 percent of the world's steel consumption and analysts believe the shortfall may not be solved until 2006 when the world's largest metallurgical coke factory begins operating in China.

[gg3]

Yes, and cement also, which is the gray powdery stuff that goes into concrete.

The steel & cement shortages are primarily what's driven up the cost of the new San Francisco Bay Bridge retrofit to the point where everyone's freaking out.

These are also the key materials for building nuclear power plants; and an appreciable amount of each also goes into wind installations.

[satjeet]

my brother in ohio has a scrap metal operation - central ohio is being scoured for car carcasses and sent to china - heh he's rich - i wish someone would start that in south jersey where you can't walk through the woods for the decaying autos

[smiley]

That makes it more intriguing to hear Alan Greenspan proclaim that the inflation risk is low.

In the past he has done a lot of research on the relation between scrap metal prices and inflation. His conclusion then was that the scrap metal market is the one of the best indicators for future inflation. It is said that the first thing he does in the morning is check the spot markets for scrap.

Basically he was saying that when the scrap metal prices are rising, one should worry, because inflation is on its way. Scrap metal prices have been rising for a long time now and inflation is evidently on the rise.

I wonder why he keeps making these statements which clearly contradict his own economic theories. The things he's saying now are obviously not his own thoughts and no one would have blamed him if he refused another term at the FED.

[brentmeister]

Technically, these aren't "peaks" in these commodities, because there are still huge supplies of reserves & resources in the relevent materials. There's truly crazy amounts of iron ore in the Pilbara, for example. It's just a current supply capacity crunch. You could certainly call it a "boom" but not a peak.

As for why does Groinspan contradict himself on inflation? It's his job.

[BabyPeanut]

It's been four years now of price increases of scrap metal. People are stealing manhole covers now.

http://npr.streamsage.com/google/progra ... id=4190127

http://www.suntimes.com/output/news/cst ... ole19.html

[MonteQuest]

Here's an eye-opener...scrap metal and used paper are the #1 and #2 exports from the Port of New York and New Jersey.

[drew]

Just an FYI, alot of what we are seeing with steel is a lack of manufacturing capacity. Bethlehem Steel went tits up a few years back, Stelco is in bankruptcy protection (and doing very well) and Algoma steel is either done or nearly so I beleive. These giants of the NA market were (are) very inefficient compared to the Japanese or Koreans for instance, and have very high labour and pension costs. Steel prices were rock bottom several years back and this cleaned out the bad apples. There are lots of reserves of iron oxide, just like oilsands. Unlike oil there will be no peak steel in the forseeable future. What is occuring now is a severe capacity shortage. Here we see that the market cannot instanly respond to quick changes in circumstance. It tends to overshoot instead. This tendency to overshoot is exactly why oilco's are not quick to jump into a frenzy of development and exploration; they dont want to get burnt again like the late 90's. Of course one other reason is peak oil, which they have likely known about for awhile now, hmmmm.
Drew

[MonteQuest]

I was not trying to infer that we were reaching peak steel, per se, but that the hungry maw of China was creating a problem of meeting that steel demand. As the emerging Asian economies gear up, I see this happening with many raw resources and commodities.

[0mar]

$this->bbcode_second_pass_quote('smiley', 'T')hat makes it more intriguing to hear Alan Greenspan proclaim that the inflation risk is low.

In the past he has done a lot of research on the relation between scrap metal prices and inflation. His conclusion then was that the scrap metal market is the one of the best indicators for future inflation. It is said that the first thing he does in the morning is check the spot markets for scrap.

Basically he was saying that when the scrap metal prices are rising, one should worry, because inflation is on its way. Scrap metal prices have been rising for a long time now and inflation is evidently on the rise.

I wonder why he keeps making these statements which clearly contradict his own economic theories. The things he's saying now are obviously not his own thoughts and no one would have blamed him if he refused another term at the FED.

[UncoveringTruths]

$this->bbcode_second_pass_quote('', 'I') was not trying to infer that we were reaching peak steel, per se, but that the hungry maw of China was creating a problem of meeting that steel demand. As the emerging Asian economies gear up, I see this happening with many raw resources and commodities.

[WebHubbleTelescope]

And to think that some researchers are contemplating using IronSand as a catalytic energy source.

I agree that iron is not disappearing. Silver, on the other hand, and certainly helium are better candidates as peak-like materials.

[skiwi]

Mr Halliday said the two miners had been driven up by upgrades from overseas analysts expecting strong commodity price rises, particularly in the current round of iron ore contract talks.

"Iron ore is the big focus at the moment – people are talking about 100 per cent increases (in prices)," he said.

Talking about Australian miners Rio Tinto & BHP Billiton in todays stock market report

[url=http://]Oz Stock Market[/url]

[Frank]

There's apparently a huge bridge somewhere (Japan or China) being rebuilt/replaced which is taking a lot of steel. Also, have you checked out copper prices lately? They've been on the rise for at least a year.

[The_Virginian]

hmmm

Would not a peak in energy needed to produce the Steel result in a Peak in steel production.???

[threadbear]

Montequest-Peak EVERYTHING, including peace of mind. What blows my mind is people who argue that prices will drop commensurate with dropping incomes in the next economic downturn. In their dreams! Dropping incomes, rising prices. Stuff for the few who can afford it, a life of thrift and making do for everyone else. Nature has spoken.

[skiwi]

AUSTRALIA'S largest steel producer, BlueScope Steel, warned yesterday that soaring raw material prices could feed world inflation and said it was considering imposing surcharges on its customers to compensate for rising iron ore and coking coal prices...

...In Asia the price of hot rolled coil steel has jumped almost 60 per cent in the past year to around $US550 a tonne...

..."You have to take this seriously. What is going on in the whole raw materials area is quite frankly inflationary," Mr Adams said yesterday.

...He said increased prices for steel-making raw materials such as iron ore and coal had been the equivalent of oil cartel OPEC raising the price of oil to $US80 a barrel...

...Miners have raised benchmark annual coking coal prices by 120 per cent for 200506. The major iron ore producers - Rio Tinto, BHP Billiton and Brazil's CVRD, which Mr Adams said formed an effective cartel - are pressuring reluctant Japanese steel mills to accept a price hike of 50 per cent-plus.

But while rising raw material prices could "feed inflation" and dampen economic growth, Mr Adams said there were no signs of that happening yet.

"We are seeing continued growth (in the) consumption of steel, and a very high level of appetite for the kinds of products that we make," he said.

He said the outlook for the industry was strong based on sustained world economic growth around 33.5 per cent and China slowing from near double-digit growth to not less than 6 per cent...

CPI risk from steel

I'm hoping that's 3.5% growth and not 33.5% but it's still just as scary

[skiwi]

SHARES in Australia's iron ore companies shot up today following reports the world's biggest producer,
CVRD, last night secured a massive 71.5 per cent increase in the price of iron ore contracts from Nippon Steel.

[URL=http://www.heraldsun.news.com.au/common/story_page/0,5478,12346041%255E1702,00.html]Massive 71.5 per cent increase in the price of iron ore contracts from Nippon Steel.
[/URL]

[skiwi]

Chinese and Saudi interests investigate NZ ironsand

Chinese and Saudi Arabian interests, with billions of dollars at their disposal, are behind moves to establish a sand-mining industry based in Taranaki...

..."A vessel will be in the area within the next two weeks to begin the survey. It will be sinking 50mm holes into the sea bed to find out if there is sufficient raw material," Mr Rutherford said.

He also said if an offshore ironsand mining industry were established in New Zealand, it would be a world first.

But the fact that its potential was being seriously investigated reflected the fact that there was huge international demand for steel...