End-user demand is robust and even growing in some sectors, such as appliances and food processing, Damstahl said, reiterating the fact that cold-rolled (CR) stainless sheet imports are no longer an option for European buyers.
Metal Bulletin’s weekly price assessment for flat CR grade-304 material was €۱,۱۰۰-۱,۱۲۰ ($۱,۲۴۹-۱,۲۷۲) per tonne delivered in Northern Europe on Friday June 23, having fallen gradually from a peak of €۱,۱۴۰-۱,۱۷۰ ($۱,۲۹۵-۱,۳۲۹) per tonne on May 12.
Falls in stainless steel raw materials prices, such as nickel and ferro-chrome, have led to consecutive month-on-month drops in the European alloy surcharge.
The alloy surcharge for July deliveries of 2mm grade-304 CR stainless steel sheet – compiled by Metal Bulletin based on data published by Outokumpu, Acerinox and Aperam – fell by €۵۲-۶۲ ($۵۹-۷۰) per tonne month-on-month to €۱,۱۳۱-۱,۱۹۰ ($۱,۲۸۵-۱,۳۵۲) per tonne.
This negative price trend has “led to a decline in orders from speculative buyers, who are mostly stockists and service centres”, Damstahl said in its monthly stainless steel briefng for June, adding that this was a “standard pattern in the stainless steel industry”.
“This [raw materials price] volatility normally leads to a reduction in base prices as well as [mills getting] ‘nervous’ when their order books are getting thin,” it added.
However, the Danish distributor said that weak apparent demand in the summer period had “rather short legs and will end before the summer [as] stockists will be back in the market with fresh orders bythen”.
Demand for stainless steel appears to have been largely positive in various European end-user industries in recent months.
EU construction activity rose by 3.80% year-on-year in March, while the German electronics industry reported a 17% year-on-year increase in orders in March, and new EU passenger car registrations increased by 7.59% year-on-year in May.
However the German processing industry reported a 3% year-onyear fall in its order intake in April. Imports of flat stainless steel products in January-February 2017 increased by 16.10% year-on-year in Denmark, by 2.30% in Sweden and by 24.10% in Finland. Flat stainless steel imports also increased in January-March 2017 in Germany, where shipment were up by 8.10% year-on-year.
Over January-February 2017, imports of the same product fell year-on-year in the Netherlands (1.70%) and in Slovenia (6.30%), while in January-April, imports into Norway fell by 6% year-on-year.
Imports of long stainless steel products in January-February 2017 rose by 7.70% year-on-year in the Netherlands, by 11.60% in Denmark, 22.90% in Sweden and 7.30% in Finland.
Imports of the same product rose by 0.80% year-on-year in Germany in January-March 2017, while they rose by 12.10% year-onyear in Norway in January-April 2017.
In Slovenia, long stainless steel imports fell by 0.5% year-on-year in January-February 2017. EU anti-dumping duties against Chinese stainless CR flat products are being circumvented by a rapid growth in hot-rolled (HR) stainless flat steel, which has increased by 73% in the year-to-date, investment bank Jefferies said on June 14.
Imports of HR stainless flat products into the EU reached roughly 55,000 tonnes in December 2016, with China supplying around 35,000 tonnes, according to Damstahl.
A month earlier, total imports of the same product into the EU were around 36,000 tonnes. With import levels up and margins down, Damstahl has questioned whether there could be an anti-dumping case for imports of HR stainless flat steel into the EU.
Regional markets End-user demand in Germany, Europe’s largest stainless steel market, is good despite the May holiday period, with this trend expected to continue into the summer break.
“Distributors still have suffcient stocks to meet the current demand and no bottlenecks in supply for commodity products are expected,” Damstahl said.
Low stock levels of stainless steel in the Netherlands could be an issue, as delivery times from mills lengthen and “terms become unacceptable”, according to Damstahl.
The Danish stainless steel market is reporting lively end-user demand, with stocks well-balanced and neither oversupply nor bottlenecks reported.
Meanwhile, lower alloy surcharges are putting pressure ondistributors in Sweden, but demand and volumes remain high.
The Norwegian stainless steel industry is steadily improving following greater project activity in the offshore oil & gas sector, Damstahl said.
And declining alloy surcharges have led to higher demand among end users in Slovenia’s automotive, pharmaceutical and mechanical engineering sectors.
Source: Metal Bulletin
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