Fuel Oil
"Asia Fuel Oil-Weak On Cooling China Demand, Eye on Arb" (Reuters)
Shrinking demand for fuel oil in China for fuel oil in China weighed heavily on the Asian fuel oil market on Friday, while heavy arbitrage supply flows into Asia were expected to further depress prices.
Buying interest from China has been badly hit by slowing industrial and manufacturing activity. A key use of fuel oil in China is as a feedstock for small and medium sized refiners, who process the residual fuel for its gas oil, which is then sold of to industries for power generation.
Diesel
"China Diesel Imports Dry Up as Economy Slows" (Reuters)
China is unlikely to import diesel for domestic use for the rest of the year due to a slowing economy, industry sources say, putting pressure on Asian diesel margins as well as potentially reversing high prices for the fuel in the West.
The drop in imports of diesel, Asia's most widely consumed fuel, is the latest example of slowing industrial activity in China feeding through to demand for resources. Consumption of iron ore, steel and copper have all fallen in recent months.
The main output of Chinese refineries is typically diesel, but China normally starts buying at this time of the year on the spot market to meet peak demand from agriculture and for power generation. This year China is still exporting.
Steel
"Iron Ore Hit by Weak Chinese Demand, Poor Steel Outlook" (Reuters)
Sellers of imported iron ore cargoes to top buyer China cut prices for a third day on Tuesday as weak demand pushed the benchmark rate to a one-week low, as the near-term outlook for the steel market remained weak despite recent gains.
...
Iron ore has recovered from a near three-year low of $86.70 reached earlier this month, on hopes that China's approval of more than $150 billion worth of infrastructure projects would boost steel demand.
But the rebound has since been curtailed by signs end-user demand for steel in China, the world's biggest consumer and
producer, remains weak despite a recent spike in steel prices.
"Inquiries are very limited. It looks like most mills are done with restocking ahead of the holidays," said an iron ore trader in Shanghai.
Ships
"China Steelmaker, Miners Cut Output as Slowdown Bites" (Money News)
SHANGHAI/DALIAN, China — A major Chinese steelmaker said on Thursday it has halted production at a loss-making plant and expressed doubt that government attempts to stimulate the slowing economy would revive demand in the world's biggest market for the metal.
With China's slowing growth sapping demand for new ships and construction, an industry official said more than a third of the country's iron ore mines were idle due to depressed prices, and the top steel producer also forecast lower output this year.
Coal
"Chinese Slowdown Idles U.S. Coal Mines" (Wall Street Journal)
Slowing growth in China is taking a brutal toll on Appalachian coal mines and coal towns.
Appalachia has one of the world's richest deposits of high-grade coal used to make steel. Thanks to Chinese demand, the price for premium metallurgical coal, whose low-ash and low-sulfur content makes it ideal for steelmaking, hit a record $330 a metric ton in early 2011.
Now, the Chinese economy is slowing and so is its steel industry. That has sent the price of coal used for steelmaking down nearly 50% to $170 a metric ton. Those coal producers who counted on Chinese sales are reeling.
"When someone had coal to move, China was your big box store," said Ernie Thrasher, chief executive of XCoal Energy & Resources, a major U.S. marketer of such coal to Asia. This year, "the switch went off."
Specialty Minerals
"Rare Earth Prices Slump Amid Slowdown" (ChinaDaily.com)
BEIJING -- Prices of China's rare earth products dropped sharply over the past month as market demand remained weak amid the economic slowdown.
Data from Baichuan Information, a raw material information provider, showed that prices of several rare metals, including lanthanum oxide and praseodymium oxide, almost reached the year's lowest level in August despite a rebound starting in June.
The price of praseodymium-neodymium oxide, primarily used to make ceramics and magnetic materials, fell to around 360,000 yuan ($56,800) per ton in August, compared to the year's lowest of 340,000 yuan per ton in March, according to Baichuan Information.
The figure was also significantly down from the highest price level of 1.4 million yuan per ton recorded last year.
"Weak downstream demand is the major reason for the price slump," said Du Shuaibin, an analyst with Baichuan Information.
Trucks
"Truckmakers Buffeted by Global Headwinds" (Financial Times)
Truck and other commercial vehicle manufacturers are facing growing headwinds from the global economy as demand in Europe, China and Brazil fades and the outlook for the previously buoyant US market grows more uncertain.
Europe’s sovereign debt crisis has caused industrial customers to postpone big-ticket purchases of heavy trucks, while public budget cuts have hurt demand for buses.
Truck sales have also slowed in China and India, two of the world’s biggest commercial vehicles markets, while tougher emissions standards and the weaker economy have caused a lull in Brazil.
Automobiles
"China Woes Put Brake on Luxury Car Sales" (Financial Times)
After months of enjoying rude health and record sales, the luxury car sector may finally be catching a cold, courtesy of falling demand in southern Europe and China.
Executives at the Paris Motor Show are clear that premium car sales are holding up a lot better than Europe’s embattled mass-market sector.
Still, the big double-digit growth rates in China they enjoyed in past months may be a thing of the past and premium vehicles are becoming a luxury that many southern Europeans can no longer afford.
Diamonds
"Luxury-Sales Slowdown in China Spreads to Diamonds" (Wall Street Journal)
Demand for diamonds is slowing in China, according to the distribution arm of mining company De Beers, the latest company in the luxury sector to suggest that the meteoric growth rates in the world's No. 2 economy are leveling off.
China jumped to become the world's second-largest diamond consumer last year, buying 10% of the world's production. The country ranks behind the U.S., which buys 38% of the world's diamonds.
"Last year, China grew over 20%. This year, it will be up around 10%," said Varda Shine, chief executive of the Diamond Trading Co., the De Beers subsidiary that distributes rough diamonds.
Household Fixtures
"China’s Inventories Pile Up as Demand Flat-Lines" (Globe and Mail)
You know it’s going to be a bad year for China’s exporters when all manner of goods – including the kitchen sinks – are gathering dust in storerooms.
“Of course [the slowdown] is affecting us,” Du Huayao, the manager at Foshan Nanhai Bigao Sanitary Ware Co. Ltd., which makes bathroom and kitchen fixtures, said in a telephone interview from his factory in Guangdong province.
“Sales this year from the foreign market have dropped from one-third to two-thirds.”
Compounding Mr. Du’s woes is China’s slowing property market, which has pulled down his domestic sales as well. The company has already laid off 20 of its original 50 workers and has slowed production.
Raw logs and milled lumber
"China’s Economic Slowdown Drives Down Demand For NW Logs" (Oregon Public Broadcasting)
China’s economic slowdown is cutting down the number of logs exported from Pacific Northwest forests.
A new report from the U.S. Forest Service says 25 percent fewer logs were exported from Oregon, Washington, Northern California and Alaska during the first half of this year. That’s compared with the same period of 2011.
Forest Service research economist Xiaoping Zhou says China’s decreasing appetite for raw logs and milled lumber is a big reason for the drop.
“China’s economic slowdown has reduced that country’s demand for log and lumber imports,” Zhou said. “This is largely responsible for the overall decrease in West Coast exports.”
So, what some of us peakniks have known months/years ago,is now becoming common knowledge, laid out flat for all to see, namely a 100% convergence of negative economic news, signaling a major depression with a major geopolitical earthquake in the making.
Posted by: roger | September 28, 2012 at 07:58 PM
Well, a reasonable explanation for
China's strange demand for her
islands from the Japanese (who have
had them for over a 100 years )now
makes some crazy sense. Some very
limited Chinese leader must have
come up with "distraction tactics"
of the real issue- rapid economic
decline. They aren't alone so should not feel picked on. They
have gone back to the Treaty of
Shimonoseki of 1896; they could also go back to the Treaty of Dec.
23,1905, where Chinese captialists
(including long avowed enemy of the
Korean Monarch Kojong, Yuan Shi'
Kai, joined a stock company of
forestry with Japanese leaders,
such as Baron Komura Jutaro,) a
few months after the powers illegally stripped Korea of her
22 year recogized status as a
sovereign state at the Portsmouth
Peace Treaty in Sept. of 1905.
The entire treaty was fradulent,
as the future of sovereign Korea
was sealed, tacitly, even as Theodore Roosevelt lied to the
Korean Emperor and denied a seat
at the conference table for Korean
plenipotentiaries who had every
legal right under international law
at the time to be represented as
an accredited state with every
participant;and as an accredited
ally of Japan in the Russo-Japanese
War. The biggest heist in this
period was Korea herself, including
the fabulous timber forests on the
Yalu (with gold mines in abundance
as well) which the Chinese and
Japanese exploited for years. The
concession legally belonged to the
Tsar of Russia who had to forfeit
it to the Japanese, western backed
heist of gold rich Korea. For
the Chinese and Japanese to be
digging up these old half truths,
now, would be like the people of
Charleston,S C demanding to have
Fort Sumter restored to the State
of SC. Really, historically the
whole thing is so absurd, and so
overladen with multiple wars and
successive agreements, that it
begs the question if panic has
unleased itself in the inner
circles of Japan and China. Or
what was the word Michael used
the other day
iNSANITY? Come, let us reason
together, East Asia.
Posted by: Marion Shaw | September 29, 2012 at 09:26 AM
i can hear Maggie from Caddyshack contemplating a Japan-China war:
"That's all i need!"
Posted by: Tom | September 30, 2012 at 08:33 AM
It's a material world, our back yard has several fruit trees and a vegetable patch, several Blue Jays and Mocking birds have taken territorial possession of this Eden, and everyday it's a bird war for control of the goodies, the laws of mother nature at works. Why do we humans think that we are exonerated from such subjectivity.
Posted by: roger | September 30, 2012 at 03:27 PM