European Highlights

摘要

The macro-economic gloom and political uncertainty continues to have an impact on EU stainless mills. Order levels are down as business confidence remains under pressure. Mills have further reduced production rates from already low levels in the second and third quarter, but are not immune to discounting off base prices to try and secure sales. This steady erosion is hurting industry profitability and producers continue to announce re-structuring to try and take out some of their cost base. As nickel prices fall, transaction pricing iscoming down and as the currency remains weak, this at least has the advantage of reducing the import threat into the market. In the short term, we see no improvement in pricing with the bias for base and surcharges to the downside for the remainder of the year. However, we do not see the European industrial sector entering another recession even as growth rates slow. Mill discipline and falling imports could therefore see the supply-demand balance swing in the mill's favour going into 2012 and there could be a recovery in pricing at that point.