NORTH AMERICAN AVERAGE STAINLESS STEEL PRICES - LATEST FORECASTS FROM MEPS

As predicted, MEPS – North American stainless steel transaction values moved up considerably in early June. These rises were due to hikes in alloy surcharges of $US380 per tonne and $US475 for grades 304 and 316 respectively. Sales volumes plummeted as buyers were aware that stainless steel prices would be lower in July due to a drop in raw material costs. Sellers were forced to make an early move to implement July surcharges in order to counteract the downturn in shipments. Mill delivery lead times remain short. Many producers restricted output in a bid to relieve oversupply pressures.

We have downgraded our forecasts slightly this month due to recent decreases in nickel, iron and molybdenum costs. Lower alloy surcharges and, therefore, transaction values for all products are predicted in July. Weakening market conditions and falling raw material expenditure, are expected to result in selling figures dropping during the second half of 2010. New rolling capacity at the ThssenKrupp USA plant could add to oversupply and put further downward pressure on prices. However, many producers are planning to restrict output in an attempt to counter the impact of the changing situation.

End-user consumption is expected to strengthen early in 2011 as the economic climate improves. Distributors will, almost certainly, look to refill depleted inventories as sales volumes grow. This, coupled with anticipated hikes in input costs, should push stainless steel selling figures upwards during the first and second quarters of 2011.
 

Source: MEPS Steel Prices Online            MEPS - North American Stainless Steel Prices