SHANGHAI, Mar 8 (SMM) - Stainless steel prices soared by over 1,800 yuan/mt yesterday, while LME nickel gained more than 25% and SHFE nickel climbed above 200,000 yuan/mt.
The main driver behind the price rise was soaring crude oil prices under the influence of western sanctions on Russia's exports. In addition, the closure of pure nickel import window also contributed to the price rise. The import losses on pure nickel have exceeded 30,000 yuan/mt and look set to expand further, hence very few imported pure nickel may enter China in the near future. The energy ban on Russia, imposed by the United States and other countries, will continue to boost the overall market sentiment. The shortages of NPI are unlikely to be eased in the short term, which will keep NPI prices firm. Steadily rising costs have led to thin profits at stainless steel mills. However, profits at stainless steel mills increased by 1,000 yuan/mt yesterday based on intra-day raw material prices due to the sharp increase in stainless steel prices. In light of the price bubble in the stainless steel market, whether the prices will go up further depends on whether consumption can keep up. SMM believes that stainless steel prices will still have room to rise in the future.