Morgan Stanley: Steel Production Near Its Peak
Prices for seaborne iron ore, a main ingredient in steel, are projected to increase by about 10 percent in 2014, according to Diana Shipping's most recent earnings call.
China is the largest steel producer, contributing nearly 50 percent of total steel production in Q1 of 2014, according to the World Steel Association.
In a Morgan Stanley note covering China steel, analyst Rachel Zhang predicts steel production to be near its peak from its recent highs, including a 3.59 percent increase in August.
Zhang expects that production will not increase materially in the near future.
On Monday, artillery fire in Ukraine influenced steel producer Metinvest to discontinue production at three more of its plants. With nearly 15,000 employees, Metinvest is a large employer in Ukraine, and that will negatively impact its economy for the time being.
Market Vectors Steel (ETF) (NYSEARCA:SLX) up 1.46 percent
United States Steel (NYSE: X) up 5 percent
AK Steel Holding (NYSE: AKS) up 6.78 percent
ArcelorMittal SA (ADR) (NYSE: MT) up 2.25 percent
Steel Dynamics (NASDAQ: STLD) up 3 percent
Schnitzer Steel Industries (NASDAQ: SCHN) up 1.14 percent
Nucor Corporation (NYSE: NUE) up 2.77 percent
Commercial Metals (NYSE: CMC) up 2 percent
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