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North American Stainless Joins Base Price Increase Pack
Dec 25,2015 16:23CST
industry news
Stainless steel base prices are now certain to rise in January.

by Katie Benchina Olsen on DECEMBER 25, 2015

Stainless steel base prices are now certain to rise in January. North American Stainless (NAS), the  stainless market leader and lowest-cost producer, announced on December 18th a flat-rolled stainless price increase that will go into effect on January 1st.

NAS Base Price

NAS’ stainless cold-rolled increase will be achieved by lowering discounts by two points, which means an increase of approximately $0.04 per lb. for 304 base gauge. The hot-rolled stainless — continuous mill plate (CMP) and discrete plate — increase will be $0.02/lb., which is the same increase that Outokumpu Coil Americas announced on December 10th.

Outokumpu’s stainless plate division recently announced an increase on mill plate by decreasing discounts by two points. NAS will also increase polishing extras costs by reducing the polishing discount 10 percentage points, which reinforces the same increase announced by Outokumpu Coil Americas. The impact of the polishing extras increase will be almost $0.02/lb., depending on material thickness.

As I wrote last week, even with the mill announcements, the effect of the base price increases will still make net prices for 304 2B base-gauge and CMP lower than net prices were this month. 304 polished product prices will still be about the same as they were in early December and still lower than the overall net prices of 2015’s fourth quarter. NAS’ January 2016 304 surcharge will be $0.3352 per pound, a decrease of $0.0544 per pound.

430 Prices

What will the impact be to 430 prices, much of which is polished?

430 2B prices will increase in January by approximately $0.025/lb. For 430 polished 18-gauge (.048 inches thick), prices increase to around $0.045/lb. January 2016’s 430 surcharge will be $0.1338/lb., a slight decrease from December 2015’s surcharge. Looking a few months back, though, 430 surcharges have decreased $0.04/lb since October 2015. Since 430 is non-nickel bearing, the surcharge fluctuations are not as drastic as 304, so the base price increase will make 430 polished net prices slightly higher than in recent months.

As I wrote in last week’s piece, the mills need to increase base prices for the long-term health of, not only themselves, but also the service centers which are responsible for the majority of stainless steel flat-rolled distribution. As NAS supported only a moderate increase, I would expect another base price increase in subsequent months if the domestic mill lead times push out beyond 10 to 12 weeks. Once everyone returns from the holidays to begin 2016, we will have a better idea of how much of an impact service center restocking will have on stainless, flat-rolled mill lead times.

Source: Metalminer

Stainless steel prices

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