The price of stainless steel in Europe fell further in the week ended Friday July 1 amid continued poor demand from distributors, sources told Fastmarkets.
Fastmarkets’ weekly assessment for stainless steel cold-rolled sheet 2mm grade 304 base price domestic, delivered Northern Europe was €1,250-1,300 (1,306-1,358) per tonne on Friday July 1, down by €50 per tonne week on week.
Meanwhile, Fastmarkets’ weekly assessment for stainless steel cold-rolled sheet 2mm grade 304 transaction domestic, delivered North Europe was €4,000-4,200 per tonne on Friday, down from €4,200-4,300 per tonne the week before.
While demand from end-users was generally described as reasonable, demand from distributors and service centers was widely said to have all but disappeared amid very high stock levels.
When nickel prices exploded in March following Russia’s invasion of Ukraine, panic set in and purchases were increased or brought forward to avoid paying even higher prices the next week, resulting in a market flush with highly-priced material.
Germany was said to be particularly oversupplied. One German distributor said it had only ordered 50% of its usual volumes for June, July and August, and that it was not facing any shortfall.
EU safeguarding measures reset on July 1, meaning material stored in warehouses can be released and adding to the oversupply. With this coinciding with the start of the traditional slow season, prospects for improved demand are slim before September at the earliest.
Asian material from counties not affected by anti-dumping duties was available at €3,400-3,500 per tonne ddp, for September delivery, sources said.
Base prices currently on offer are for September rolling and one distributor forecast September alloy surcharges to be approximately €2,600 per tonne.
“This means base prices are still too high, they aren’t competing with Asian material. And they need to, they are really struggling with the distribution business,” one distributor said. “They have room to go lower too, they’ve all had record results recently.”
Faced with such weak fundamentals, several mills are embarking on longer-than-usual maintenance turnarounds this summer.
“A lot of people expect the market to pick up again in September. Until then, it’s going to be very weak,” another distributor said.
Published by Ross Yeo