NEW YORK — A hike in commodity-grade stainless steel transaction prices that went into effect with shipments at the beginning of the year has managed to hold so far, market sources told AMM.
"There was some talk that it (the reduction in discounts) would go from 4 percent(age points) to 2 percent, but I needed some material and it was 4 percent," a Midwest distributor said.
"So far, everything I’ve seen indicates that the increases are sticking," a second Midwest distributor source said.
Prices for 304 cold-rolled sheet are now around $1.40 per pound, up from $1.29 a month ago, while 316 cold-rolled sheet is around $1.90 per pound, up from $1.76 in the same comparison.
Adding to the price increases were higher surcharges for January on the back of rising nickel prices in December.
Whether the price hikes ultimately stick depends on business levels over the next few months, sources said.
"It’s a little bit early. It’s really up to the mills as to what they see their order books at," said a third Midwest source, who added that he saw lead times for some domestic mills at about five weeks. "That’s pretty short."
The price increases were announced in November, with all domestic mills following a move by Ghent, Ky.-based North American Stainless Inc. to raise transaction prices on 200-, 300- and some 400-series cold-rolled flat products by decreasing discounts by 4 percentage points (amm.com, Nov. 15).
Potentially buoying increases on 400-series grades is a recent fire at Luxemburg-based producer Aperam SA’s stainless mill in Gueugnon, France.
"Really, it’s affecting us minimally in our business, but it’s going to affect us in terms of customers who are looking for material," the third Midwest source said, adding that the mill was a supplier of specialty ferritic grades to some large appliance manufacturers in the United States. "That was their major ferritic mill in Europe. It’s where all the bright annealed that they produce comes out of."
Damage from the fire is expected to affect production at least until the second quarter, according to AMM sister publication Steel First.
Activity at the plant’s other lines, which depend on the output from the damaged annealing and pickling line, can be maintained until the end of January with existing inventories.