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STAINLESS
STEEL AND NICKEL PRICE FORECASTS FROM MEPS
NORTH AMERICAN HOT ROLLED STAINLESS TYPE
316
Stainless selling prices are
set for a hard landing as alloy surcharges will show significant
month on month declines until at least October. Type 316 figures
for September are almost $US1,100 below those in August and October's
forecast to be another $US670 per tonne lower. Moreover, basis values
are not likely to improve in the short term. A notice able
transaction price recovery, is not, therefore, anticipated until
the first quarter of 2008 due to weaker market conditions.
Distributors are expected to
re-evaluate their stock levels early in the New Year. Mill orders
should then increase. However, we do not anticipate the same upturn
as recorded at the beginning of 2006. Buyers will remain wary as
they continue to count the cost of the recent sudden collapse in
the value of their inventories. For this reason only a steady transaction
price improvement is forecast for 2008.
NICKEL
As predicted in July, nickel prices fell
under the $US30,000 per tonne mark during August. However, the rate
at which it continued to drop was greater than anticipated, with
values falling to almost $US25,000 per tonne by the middle of the
month. Stocks at the LME climbed above 20,000 tonnes for the first
time since May 2006, when, at that time the cash figure stood at
around $US21,000 per tonne. Stainless mills are not expected to
increase nickel purchases while high volatility remains. This should
result in stock climbing higher, causing the nickel cash monthly
average figure to slip further in the short term. Prices are forecast
to stabilise during the fourth quarter of 2007 and into 2008 as
stability returns to the stainless market.
05.09.2007
Source: MEPS - Stainless
Steel Review
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