UNITED KINGDOM June 03 2016 4:21 PM
LONDON (Scrap Register): Stainless steel producers around the world are trying to lift their selling
prices, by more than any adjustment for raw material costs, after a long period
of stable, very low figures, said MEPS International in a snippet.
Basis
values were stuck at a point very close to the mills’ breakeven levels for a
long time. The steelmakers are now taking advantage of a combination of market
factors to put forward price advances that will make their businesses more
profitable.
Purchasing activity has increased, in several regions. This
is not driven by underlying demand, in all cases. Restocking and anticipation of
rising prices have affected some buying decisions. On the supply side, scarcity
of material from China, particularly cold rolled coil, has had a major influence
on recent price agreements.
In North America, where there has been a
slight upturn in real demand, local producers introduced cuts to their list
price discounts – effectively, raising basis values – in January and March of
this year. Following the announcement of an investigation into alleged dumping,
customers are reluctant to buy Chinese steel. With the resultant tightening of
supply and extended delivery lead times, the mills applied another increase, in
May, and further increments are not ruled out.
China’s home market has
been quite strong, in recent months. As a result, the volume of material
available for exports to other countries in the Far East has been restricted.
Buyers in South Korea and Taiwan have, therefore, been forced to accept the
hikes presented by their domestic producers, in order to secure
deliveries.
Antidumping measures against Chinese and Taiwanese cold
rolled coil have been in place, in the European Union, for some time. Although
this has not yet had an inflationary effect on transaction values, it brought
about a closer balance between supply and demand. Supported by more expensive
import offers, local producers are expected to have some success in securing
higher basis figures, in June.
For queries, please contact Michael Jiang at michaeljiang@smm.cn
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