NEW YORK — Stainless steel distributors continue to be conservative with their buying as demand remains tepid and stainless surcharges look set to trend down again.

"We’re not going out for more than we need. We’re certainly not looking at it and going, ‘We’re going to load up here.’ It doesn’t bode well for the mills’ bookings in December," one Midwest distributor source said.

A southern distributor source agreed, noting that continued sluggishness in stainless demand was also keeping his purchasing to a minimum. "I’ve never seen it as quiet in October. It’s usually a bang-up month," he said.

Stainless surcharges rose for October and November following a nickel price spike in September, but the base metal has since fallen, with the cash contract ending the official session on the London Metal Exchange at $16,150 per tonne ($7.33 per pound) Friday, down 12.6 percent from $18,480 per tonne ($8.38 per pound) a month ago.

With nickel on the decline, it is likely that December’s stainless surcharges will be lower than those for November, encouraging some would-be buyers to sit out for now.

According to market sources, grade 304 cold-rolled sheet is now being sold for $1.36 per pound f.o.b. mill, up 2.3 percent from $1.33 per pound a month ago mainly due to the higher surcharges.

Most sources said base prices had been steady lately, albeit at low levels, although some suspected discounts were available for larger orders as mills look for bookings in a slow environment.

"I didn’t have any tons to shop for in November, but people have called to see if we were buying anything," a second Midwest distributor said.

Offers from foreign mills are also said to be more frequent as stainless demand has slowed globally.

"Prices are going to be diluted by the fact that there’s so little demand and so many people trying to sell it here," the southern distributor said, adding that he had recently been offered a large volume of inventoried material from an Asian stainless producer.