European stainless steel market watching, waiting on energy uncertainty

The stainless steel market in Europe remains subdued and with largely flat prices, but participants are watching and waiting for clarity on how the developing energy crisis will affect the fourth quarter, sources told Fastmarkets on Friday August 26.
Base prices were unchanged for the third consecutive week, having previously fallen more-or-less continuously since late March.

Fastmarkets’ weekly assessment for stainless steel cold-rolled sheet 2mm grade 304 base price domestic, delivered Northern Europe was €1,100-1,150 ($1,098-1,148) per tonne on Friday, stable from the previous week.

Transaction prices, which have followed a similar trend to base prices in recent months, were assessed lower this week amid continuing weak demand and oversupply.

Fastmarkets’ weekly assessment for stainless steel cold-rolled sheet 2mm grade 304 transaction domestic, delivered North Europe was €3,000-3,100 per tonne on August 26, down by €200 per tonne week on week.

Sources believe, however, that prices have probably reached their lower limit.

“We do see some more demand, but prices are still low. We expect prices to have bottomed and expect some increases in September, also because of higher energy costs,” said one distributor.

Not all sources agreed that demand had picked up, and claimed it was the contrasting effects of low demand and rising costs that were leading to uncertainty.

“We are in wait-and-see mode on the energy. It’s going up by €100 per tonne each day, but also distributors are still waiting for orders. It’s a very depressed situation. I don’t think we’ll see any [price] movement for the two or three weeks, we need to wait for the mills,” said a re-roller.

Alloy surcharges are set to decrease for September, however, which could balance out any energy-related increases in the final transaction price.

Not all mills had announced their September alloy surcharges yet, but one key mill had issued a decrease of €147 per tonne month on month for grade 304 flat products.

Published by: Ross Yeo