Hope for a seasonal upturn fades, but prices remain firm

摘要

Despite downward pressures in Western Europe, in October, the global stainless steel market was characterised by stable or increasing base prices at a time when-surcharges also peaked. Cold rolled "18-8" material attracted 2,951 dollars/t in Northern Europe, compared to 2,898 dollars/t in the USA, and 2,117-2,664 dollars/t in Asian countries. Transaction price discrepancies are long-standing and result from trade barriers, exchange rate fluctuations, transport costs, as well as the different methodologies used to calculate alloy surcharges. Set in this framework, however, the October price dynamics ranged from a shortage of hot band for re-rolling pushing prices up by 63 dollars/t in China; through sluggish industrial production growth enabling European and Japanese consumers to fend off tase price increases; to US end-users benefiting from a 103 dollars/t reduction in the grade 304 alloy surcharge. On the supply side, mills in Western Europe and Japan adopted restrictive shipment strategies in anticipation of a rise in energy costs, and in an attempt to sustain base price stability in the short-term. Unlike the month-on-month leap in September 2003 - when newly commissioned capacities contributed to a 33 percent surge in Western European melted production of all types of stainless steel - moderate increases are the most likely scenario for both September and October of 2004. Meanwhile, Japanese austenitic hot rolled output in August was some 17,000 tonnes below its levels of one month and one year ago. Even the very small Russian stainless steel industry reduced its output by 12.9% to 84,200 tonnes in the first nine months of this year, which prompted local mills to file a dumping complaint against European importers. Driven by rebounding domestic demand, at 71,221 tonnes in September, Chinese melted production of austenitic grade material was 5.1 percent percent above its August level, and 8.8 percent higher year-on-year.