Mexico’s July industrial output growth slows to 0.2pc
Mexico's industrial production growth slowed to just 0.2pc in July from the previous month, statistics agency Inegi reported Tuesday, supported by rebounds in construction and non-oil mining.
The monthly gain in industrial output, following a 0.4pc increase in June and a 0.7pc gain in May, marked a fifth month of expansion in the seven months through July.
Seasonally adjusted, construction led major components in July, expanding by 2.6pc over June, with mining expanding by 1.4pc over the previous month.
Oil and gas extraction, however, was down by 0.2pc from the previous month, after 0.5pc growth was reported in June. The segment has now shown contraction in 10 of the last 12 months.
Extraction of other minerals, however, increased by 0.4pc over the prior month, after a 4.6pc decline reported in June. Mining-related services also rebounded, up 14.8pc in July after a 9.7pc contraction in June.
Manufacturing reversed course in July, registering a 0.8pc contraction from the previous month after posting a 2pc expansion in June.
This is largely the result of the auto manufacturing segment posting a monthly contraction of 3.1pc in July after a 5.8pc expansion in June.
The auto segment comprises 24pc of the manufacturing component in Inegi's monthly industrial activity report (Imai), and manufacturing accounts for 63pc of nationwide industrial activity.
Auto output, however, should rebound in August with INEGI reporting Monday that light vehicle production in August was up almost 20pc from July.
Meanwhile, the utilities component — tracking provision of electric power, water and natural gas — contracted for a second consecutive month, down 0.9pc in July after a 0.2pc contraction recorded in June.
Manufacture of products derived from oil or coal expanded for a second month, up 3pc in July on a monthly basis after a 10.6pc jump in June.
Looking ahead, Mexican bank Banorte said, "We believe that the bias for industry in the remainder of the year will be negative, with headwinds for construction and manufacturing."
Some drivers, it said, include: "weakness in US industry; lower base metal prices due to a global economic slowdown, especially in China; the completion of local infrastructure works; and some circumstantial factors that have added volatility within different sectors."
Nevertheless, Banorte's industrial outlook for 2025 and the medium-term remains positive as the major infrastructure projects for the incoming administration get underway.
By James Young
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S Korean plate sales into EU revive AD probe talks
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US inflation slows to 2.5pc in August
US inflation slows to 2.5pc in August
Houston, 11 September (Argus) — US inflation slowed in August to the lowest rate since February 2021, marking a fifth month of easing inflationary pressures and paving the way for a widely expected cut in the Federal Reserve's target rate next week. The consumer price index (CPI) slowed to an annual 2.5pc in August from 2.9pc in July, the Bureau of Labor Statistics reported today. So-called core inflation, which strips out volatile food and energy prices, rose by 3.2pc in August, matching the July reading, largely due to an uptick in monthly shelter costs. After the report, the CME's FedWatch tool signaled an 83pc probability that the Fed will cut its target rate by a quarter point at next week's Fed policy meeting from 66pc odds Tuesday. Probabilities of a half point cut fell to 17pc from 34pc the prior day. The energy index contracted by an annual 4pc in August, following a 1.1pc gain in July, while the gasoline index contracted by 10.3pc in August, accelerating from a 2.2pc decline in July. Energy services eased to an annual gain of 3.1pc following gains of 4.2pc in July. Food costs rose by 2.1pc in August, slowing from a 2.2pc gain in July. Shelter rose by 5.2pc after a 5.1pc gain in July. Transportation services rose by 7.9pc in August, slowing from 8.8pc in July. Headline CPI rose by 0.2pc in August from the prior month, matching July's monthly gain. Core CPI accelerated a tick to 0.3pc in August following a monthly 0.2pc gain in July, largely as shelter rose to 0.5pc from a prior 0.4pc and transportation services surged to a 0.9pc monthly gain from 0.4pc. After falling to 3.1pc in January, inflation reaccelerated to as high as 3.5pc in March, prompting the Federal Reserve to hold off on widely expected rate cuts after holding its target rate at 23-year highs since July 2023 to contain inflation, which surged as high as 9.1pc in June 2022. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
UK metals industry calls for political stability
UK metals industry calls for political stability
London, 11 September (Argus) — Industry leaders and public servants have called on the new UK government to provide much-needed stability for the metals industry today at the UK Metals Expo, after years of an "inconsistent" approach under the previous government. Attendees at the event in Birmingham, England, heard that the new government is expected to "hit the ground running" after years in opposition, with a clear manifesto commitment to industrial strategy. "We've seen a lot of disruption, first from Brexit and then from the Covid-19 pandemic," said Seamus Nevin, chief economist and director of MAKE UK, the UK's manufacturers association. "There have been 15 different ministers in charge of industrial policy over the years and six different revisions of government strategy. The amount of churn and change has been very disruptive, you can't run a company like that. Following the last general election, we now have a new government which committed from day one to a new industrial strategy, with manufacturing at the forefront of their plans." Nevin pointed to new policies by the Labour government which he expects, if successful, to help the metals and manufacturing industry gain a more stable footing after years of instability. These include a new nationalised energy company, the removal of barriers to onshore wind power and the creation of a new statutory body, the Industrial Strategy Council (ISC), which will oversee future governments' policies in a similar way to the UK Office for Budget Responsibility (OBR). "This new government is going to take a far more interventionist approach to industrial strategy than the previous one," said Timothy Stock, head of green industrial strategy at the Department for Energy, Security and Net Zero. "We need be more clear-eyed about sectors which have growth opportunities and capitalise on where the UK has strengths. Taking a long-term view is vital." Long-term view crucial to competitiveness A more steady government with a strong mandate will need to set out long-term strategic goals for the UK's industries, which are crucial for international competitiveness, attendees heard, with personnel stability key to ensuring this. "During the chaos of the last years of the last government, things did slow down," Stock said. "Things like having the same minister in charge at the secretary of state position for the whole five years of the government is an internal aim of theirs and one that I think is really valuable to build that knowledge base and consistency." He added that the ability to take new ideas and commercialise them in the UK is also important, but this relies on "clear and visible" government policies. In the past, research and development undertaken in the UK has been picked up and commercialised in other countries such as the US and Germany. "The transition to net zero is going to be heavily reliant on our foundation industries like metals. We can look at examples in the past where we've been successful, like deploying offshore wind turbines, where we haven't really seen the benefits in domestic manufacturing," said Stock. "As we drive towards net zero, this new government is cognisant of getting the benefits in terms of manufacturing, onshoring the manufacturing of these materials and parts and not just relying on imports. So building out those supply chains is a high priority." Other panellists agreed that onshoring is part of the overall plan, especially with protectionism in metal-adjacent industries spreading around the world. Phillippa Oldham, stakeholder engagement manager at the UK Advanced Propulsion Centre (APC), pointed to new rules around electric vehicles that mean domestic manufacturing must be a priority for the Labour government. "The automotive sector is worth £80bn in revenue to the UK," she said. "The supply chain is the thing that is so critical here. There are things like EU rules of origin coming into force in the UK market, so we need to figure out how to localise those supply chains and make them circular here in the UK." By Thomas Kavanagh Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Q&A: India’s Jindal Stainless eyes 10pc export growth
Q&A: India’s Jindal Stainless eyes 10pc export growth
Mumbai, 11 September (Argus) — Indian stainless steel producer Jindal Stainless (JSL) is confident of strong growth in domestic and export sales in the 2024-25 fiscal year ending 31 March, as a result of a significant recovery in European demand and new supportive measures from the Indian government. Argus spoke with JSL's managing director Abhyuday Jindal about his market expectations in the coming months and the firm's sustainability plan. Edited highlights follow: What are JSL's expectations for the next quarter and for FY25? We expect a relatively modest performance in the upcoming quarter and for FY25. On the global front, despite the protectionist measures, exports are gradually picking up, particularly to Europe, and we have now extended our reach to Japan and Korea. Looking at the current global scenario, we are expecting 10pc export projections for this fiscal year. In Europe, the recovery is more noticeable in western countries such as Germany, Italy, and France, although it remains relatively modest. Domestically, we expect a robust demand, bolstered by the government's annual infrastructure budget of 11.11 trillion rupees ($132.2bn). This presents a significant growth opportunity, particularly as we have started manufacturing stainless steel long products. How is the removal of import duties on raw materials benefiting the growth of the stainless steel industry? The removal of duty on ferro-nickel is expected to make the stainless steel industry more competitive. It will especially help the suppliers in India to develop, as now they will have multiple options across the globe to source the raw material and produce desired outcomes. How much does government support and policies positively impact the steel sector? The Indian government has shown support for our industry through initiatives like the Production Linked Incentive and the Make in India campaign. The forthcoming stainless steel policy is also expected to drive increased usage of the metal domestically. Additionally, the government is now actively promoting the use of stainless steel in infrastructure projects. Recently, the road transport and highways ministry recommended using stainless steel within 30km of the coastline for construction purposes. JSL is the first private entity in steel sector to spearhead government of India's Brand India initiative. What are JSL's initiatives and strategies for achieving net zero emissions and by which year? Jindal set the target of achieving net zero emissions by 2050, adopting energy efficient technologies, scaling up renewable energy and integrating circular economy principles in our operations. We have reduced over 300,000t of carbon dioxide in the last three fiscal years and are investing Rs7bn in sustainability projects to reduce 1.5mn t of carbon emissions per year. We are the first stainless steel manufacturing company in India to have installed a green hydrogen plant to produce stainless steel. We have also partnered with India's largest renewable energy company to develop a utility-scale captive renewable project for the supply of power to our Jajpur plant, Odisha. We have also invested in rooftop and floating solar plants to mitigate carbon emissions. We were also one of the only stainless steel companies to have participated at the prestigious Cop-28 held in Dubai last year. Any capacity expansion plans and investments? We have recently announced a three-pronged investment cum expansion strategic plan, which includes setting up a steel melt shop in Indonesia by investing Rs7bn for setting up a 1.2mn t/yr steel melting shop. It is a plug-and-play model and expected to be operational in 24 months. With the new melt shop in Indonesia, our total capacity will soon reach 4.2mn t/yr, positioning us among the top three global stainless steel manufacturers. Infra upgradation of our Jajpur plant we are investing Rs19bn to improve and upgrade the infrastructure in our plant in Odisha, India. JSL acquired Chromeni Steels Private Limited in Gujarat at an investment of Rs158.9mn to increase the capacity of our cold-rolling facility in line with our long-term vision of increasing the proportion of cold rolled products in our entire product mix. By Deepika Singh Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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