Metal Bulletin Research Stainless Steels Market Tracker

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Stainless Steels Market Tracker
Global market analysis of stainless steel flat and long products

US prices closing in on European levels
Chinese producers struggle against oversupply
Alloy surcharges up but falls expected
With consumption growing at more than 15% year-on-year during the first three quarters of this
year, an unseasoned observer of the global stainless steel markets might conclude that Chinese
producers have it best of all stainless steel producers worldwide. Things are not quite so simple,
however, with producers here continuing to undermine their own position with their high
production levels. Chinese production has increased by almost 20% during the first nine months
of this year, resulting in domestic oversupply and this has seen Chinese producers have no
option but to cut prices sharply and quickly this month as nickel prices have fallen (by some 8%
since late October). Of course, stainless steel prices in Asia are generally more responsive to nickel
price movements anyway given the lack of an alloy surcharge system, as exists in Europe and
the USA, but the fact that prices have held up better elsewhere in Asia indicates that the supply/
demand balance is worse in China.
US producers appear to be enjoying the strongest market fundamentals, with producers here
now thought to be looking for a third base price increase beginning January. This follows the
successful implementation of the previous two base price increases in August and October.
Improved economic sentiment has helped but it must also be remembered that US prices have
underperformed those in Europe for much of this year and perhaps recent increases are only
making up lost ground. US imports have subsequently been low this year but as the gap between
US and European prices is now almost closed (see chart), any further increases may change the
dynamics of US trade patterns.
Issue 243
November 2013
29 November 2013
www.metalbulletinresearch.com
Contents
Market prices
2
North America
4
Europe
6
Asia
8
Scrap highlights
11
Alloy highlights
12
Alloy surcharge highlights
14
Global stainless output /production
highlights
15
Stainless steel price summary /
key market indicators
16

Austenitic Transaction Prices for cold-rolled (CR) 304 2mm/2B sheet1 in selected
markets, US$/tonne
A modest improvement in global stainless steel prices is expected once 2014 arrives

5,000
4,500

Nickel share of US surcharges
Asia 304 Transaction

Europe 304 Transaction
USA 304 Transaction

Forecasts

4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
Nov Feb May Aug Nov Feb May Aug Nov Feb May Aug Nov Feb May Aug Nov Feb May Aug Nov
09 10
10
10
10
11
11
11
11
12
12
12
12
13
13
13
13
14
14
14
14
Source: MBR. Note: 1 Asian prices refer to coils not sheet.