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STAINLESS STEEL

Stainless Centers Keep a Lid on Stocks; Demand is Strong

November 15th, 2006 / Stainless Steel

Unlike the carbon side of the steel industry, stainless service centers are keeping tight reins on inventory, though mills aren’t limiting production. Executives at the stainless service centers say they’re keeping a smaller inventory than normal. The smaller inventories are not because of a lack of demand, but the surcharge cost. Centers say keeping too much inventory on hand can be dangerous to the bottom line if nickel prices take a dive and the metal can’t be sold for as much as it was purchased. Right now, mangers are buying what they need and are not taking on any long positions.

The stainless mills’ December surcharges jumped about 10 cents a pound as a result of an increase in the cost of nickel.

American Metal Market. November 9, 2006.

Stainless Looking for November Relief as Prices Mount

October 10th, 2006 / Stainless Steel

With September winding down and surcharges set to go up again in October, stainless steel buyers continue to face high prices and tight supply. Views are mixed on how the picture will play out for November. Some stainless suppliers are letting inventories dwindle in hopes of a smaller surcharge in November while others are softening prices as a way of attracting business and ridding themselves of high-priced metal in fear of a price decrease.

Prices have been rising dramatically since the beginning of the year because of both base price and surcharge increases. The demand is still very strong and availability is still very tight now and it’s leading some users to find alternatives.

A presenter at the Metals Service Center Institute’s Economic Summit: Forecast 2007 event in Schaumburg, Ill. predicted stainless would decrease next year.

American Metal Market. September 28, 2006.

ATI Charges Fail to Cool Hot Market For Stainless

September 7th, 2006 / Stainless Steel

Stainless steel flat product demand shows no sign of abating, despite substantial surcharge increases to be implemented in October. Allegheny Technologies Inc. (ATI) of Pittsburgh was the first of North America’s three main stainless steel producers to issue its October surcharge list. ATI has set its Type 304 stainless surcharge at $1.2571 a pound, up 14.8 percent in September; Type 316 at $2.1077 a pound, up 14.1 percent; and Type 321 at $1.4219 a pound, up 14.9 percent. The increases reflect the high price of nickel throughout August, the month against which the October surcharges are calculated. Currently, the average monthly price for nickel is at $13.94 a pound, up from $12.44 a pound during August. Demand is strong across all markets but especially in the energy market, sources said. “Demand’s decent and better than last year,” a Midwest buyer said. “Anything stainless for energy – pipe, tubing, tanks for storage, production, drilling or distillation – that whole ethanol and energy thing is hotter than anything.” The events have created a “perfect storm,” to the benefit of producing mills, he added. “I don’t know anyone who thought that at the beginning of the year prices would get where they are. The tight supply and strong demand have caused the increases.” North American mill lead times stretch into November, depending on the product, and those in Europe are out until December, sources said.

American Metal Market September 6, 2006