STAINLESS STEEL PLATE AND NICKEL PRICE FORECASTS FROM MEPS

Hot Rolled Plate transaction values moved up again this month in all regions as a result of further raw material price rises. In the EU, basis figures for type 304 reduced slightly to offset approximately 20 percent of the surcharge increase.

Hot Rolled Plate selling values are expected to continue their upward path over the next few months. Basis figures are forecast to slip slightly in both the EU and North America. Chinese export volumes are significantly lower for Plate than for Hot and Cold Rolled Coil. As such, transaction prices in all regions should not experience the same level of negative pressure and could record greater gains. Rising nickel prices are still predicted to take their toll on the market. Plate values are forecast to stabilise over the summer months in all regions before moving downwards.

Average monthly nickel prices moved up further in May. We anticipate values slipping next month, but still remaining close to the $US50,000 per tonne mark. This is due to Norilsk being unable to ship until mid June as a result of a port closure. The second half of the year is then forecast to record sharper declines as slowing nickel demand from stainless steel mills in all regions takes its toll. During May, nickel inventories on the LME rose to their highest level since July 2006, with stocks over the past three months showing a definite upward trend. The market is now expected to return into balance by year end with the risk of a potential severe downward correction of LME prices.                                                                                                             31.05.2007

Source: MEPS - Stainless Steel Review - click here for a free sample copy.

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