NEW YORK Stainless scrap
consumer buying prices have risen on the back of stronger
nickel prices in December and restocking by stainless mills,
although some processors say demand in the new year has
nonetheless been below expectations.
"Its better than November
and December, but we were thinking it was getting much better
than what it is," one processor source said.
"I talked with (a stainless
steel producer) yesterday and they havent seen any kind
of increase in demand at this point," a second processor source
Consumers are currently paying
between $1,790 and $1,865 per gross ton for 304 clips and
solids, up from between $1,700 and $1,770 per ton previously,
while prices for 316 clips and solids have risen to between
$2,420 and $2,465 per ton, up from $2,350 to $2,400 per ton
Some processors and mills had
reported earlier in the week that demand in January had risen,
pushing up processor buying prices, though some sources
cautioned that they had not seen a significant pickup (
amm.com, Jan. 8).
"The processors have swallowed
the exuberant pill. They expected very, very strong (consumer)
pricing in January, but theres not anything to warrant
that," a third processor source said.
The rise in buying prices and
the smaller-than-expected gain in selling prices have led to
tight margins in the industry, sources said.
In addition to January
restocking by mills, the start of Outokumpu Stainless USA
LLCs melt shop in Calvert, Ala., has been touted by some
as a boon for the market this year (
amm.com, Jan. 2), but sources said consumption
there is still small as the facility is in ramp-up mode.
"Its not an adult and he
doesnt eat full meals yet," the third processor source
Even with demand below
expectations at this point in the year, sources said there
could be some tightness in 316 scrap supply in the coming
"On 316, theres just not a
lot of scrap available," the second processor source said.
Meanwhile, the cash nickel contract on the London Metal
Exchange has averaged $17,375.71 per tonne ($7.88 per pound) so
far in January, down slightly from $17,406.58 per tonne ($7.90
per pound) in December, the basis for Januarys