Current Stainless Steel Market……

Home/Materials, Materials and Economic Background/Current Stainless Steel Market……

Current Stainless Steel Market……

The Stainless Steel market has emerged after the summer, with price increases held back by lower demand and the summer lull. Material availability is good and distributors have been selling off their high stocks.

The EU was concerned about rising imports from emerging markets and S.E. Asia, which they feared would rise further as 25% tariffs in the US diverted metal to the EU. So, from 18th July, the EU set import quotas based on average imports for 2015/16/17 and set 25% tariffs for imports in excess of the quotas, the aim being to reduce availability and reduce competition for EU home S/S producers. In Q2 Distributors ordered forward to beat the tariffs and currently have good stocks. At present rates of import, then the quotas may not be exceeded until much later in the 200 day period for which they are effective. The good availability means the EU mills have not been able to force through the price increases they hoped for….yet.

Nickel stocks on LME and SHFE have reduced significantly, but the US trade disputes and tariffs appear to have undermined investor confidence and consequent price increases. Nickel will be continuing in supply deficit for the next couple of years, so, rising prices could be seen as we move forward.

In the short term, weaker than anticipated China demand growth has led to a fall in Ferro-Chrome prices which will hold back the Alloy Surcharge levels in October/November.

So, geo-political events have overtaken supply-demand balance as the driver of price, whilst on the other hand the Nickel supply deficit continues to reduce Nickel stocks.

The final outcome depends on resolution of the Trade disputes and a smooth Brexit. The next 6 months will be interesting!

By | 2018-09-11T21:12:15+00:00 September 11th, 2018|Materials, Materials and Economic Background|