NEW YORK Stainless scrap
processor buying prices have tumbled due to declining London
Metal Exchange nickel prices and continuing soft demand,
according to market sources.
Processors are buying 304 solids
at $1,650 to $1,700 per gross ton, down from $1,700 to $1,790
previously. Transactions for 316 solids are in a range of
$2,275 to $2,350 per ton, down from $2,350 to $2,420
Prices for 430 bundles and
solids tightened to a range of $465 to $500 per ton from $465
to $520 previously, while 409 bundles and solids dropped to
$375 to $405 from $380 to $430 per ton.
The London Metal Exchanges
cash nickel price ended the official session at $17,200 per
tonne ($7.80 per pound) Feb. 20, down 5.9 percent from $18,285
per tonne ($8.29 per pound) Feb. 12.
Markets sources told
AMM that the fall in nickel prices, combined with an
ongoing weakness in demand, has engendered the drop in
free-market stainless scrap pricing.
"The market has taken a turn for
the worse. The prices have dropped dramatically: one, because
nickel has dropped, and two, because the order books at the
mills just arent very good," one processor said.
"Consumers have material and
theyre not too aggressive. Plus the export market is
pretty dead," one dealer said. "Business is quiet. The only
reason prices have been staying up where they are is because of
the lack of material."
Some sources described the drop
as an inevitable correction, given that demand has been below
expectations since the start of this year.
"Weve been warning people
about this for a while, saying that the stainless prices are
overblown," a second processor said.
"I think the market got ahead of
itself a little bit and that always has to be corrected. The
market has to go down or the demand has to come up to meet it,"
a third processor said. "I dont think theres been
any change in demand, its still medium (to) OK. But it
has been that way for six months."