Stainless steel base price hikes reportedly are sticking,
although consumer demand has yet to strengthen, according to
Free-market prices for
Type 304 cold-rolled sheet have risen to around $1.17 per pound
from $1.16 previously, 304 coiled plate has increased to $1.16
per pound from $1.15 and 304 uncoiled plate has moved up to
$1.97 per pound from $1.96.
The price increases
were mostly attributable to rising raw material surcharges (
amm.com, Aug. 21), with base price increases
implemented at the beginning of August continuing to hold in
the market, distributors told AMM.
"So far, everyone has
stuck to their guns," one distributor source said.
"Its been a
tough summer for everyone, but weve had a little uptick
in the market as people try to get ahead of those price
increases. And it looks like theyre sticking," a second
distributor source said.
However, the base
price increases have failed to spur demand in certain consumer
sectors despite another increase set for Oct. 1, some
really creating any demand, though were seeing some guys
pull the trigger. Energy is good and the alternative fuels
sector, those customers seem to have a bit more money and
momentum. The automotive and truck aftermarket is kind of
flat," a third distributor source said.
"I see dismal demand
right now. Everything is flat. When nickel tanks, it
doesnt help demand because people hold off and wait for a
lower surcharge the next month," a fourth distributor source
Indeed, the London
Metal Exchanges three-month nickel contract has fallen
below the $14,000-per-tonne ($6.35-per-pound) mark this month
after closing as high as $14,800 per tonne ($6.71 per pound)
A fifth distributor
source said that base price hikes and increased purchasing from
distributors had only created an illusion of more consumer
demand. "I feel that these price announcements have caused
distributors to buy up whatever depot stock the mills had
available, which lengthens lead times. What I dont see is
an uptick in real consumer demand to motivate that much
stainless production from the mills. I think the activity going
on is about beating the next price increase," he said. "The
mills are deluding themselves that theyre fat and happy
again. I dont see nickel going back up, and I think what
is going on right now is an anomaly."