Exclusive outtakes from industry leaders
This time last year, steel mills and base metal miners were in an unprecedented slump, with metal prices bouncing off multi-year lows amid steep economic downturn. Since then, the world economy has turned upwards and demand for metal is resurging. While many analysts have cited economic recovery for the price gains, they add that demand signals show only slow, choppy growth. Whether metal prices have gained as investors search for a place to put excess liquidity or are based in solid supply/demand fundamentals remains a question. Get exclusive insight into the sector from the Reuters Global Mining and Steel Summit taking place in New York, London and Sydney on Mar 8-11.
Prices for copper, zinc and aluminum have plummeted in the last four months as the global economic downturn cut demand from China and other developing countries who needed metals and steel to build up their infrastructure.
Mining companies who were hot last year and earning unprecedented profits until last September, have had to scramble to deal with the lower outlook by cutting costs, laying off workers, idling plants and reducing production.
As a global recession hits just about every industry, steelmakers too have felt the brunt, logging dramatic declines in demand.
Output for steel globally sank nearly 25 percent in January alone, with North America posting a more than 50 percent decline. Still analysts say the steel industry may be positioned to survive a recession.