For the Quarter Ending June 2022
North America
Al6XN Plate prices in the US market increased during the second quarter of 2022 due to increased concerns about rising geopolitical tensions, supply-chain disruptions, and growing inflationary pressures. According to market participants, the rate of overall factory growth accelerated for the third month. It was the fastest since September, owing to speedier production expansion, a softer seller performance decline, and a series-record drift in pre-production inventories. Although delivery times lengthened further, suppliers' severe material and capacity shortages led to sharper cost and selling price increases. Despite ongoing inflationary pressures, demand expanded as the New Orders Index grew. Buyers are still confronting higher transportation charges and logistical bottlenecks. Mills have announced price increases to become more competitive with imports along with increases in freight rates as even imports are facing port congestion and higher trucking costs from the ports.
Asia Pacific
In the Asian market, the AL6XN Plate prices witnessed mixed sentiments due to fluctuating raw material prices. In May and June, AL6XN Plate prices surged, and rising nickel prices prompted a rise in Stainless Steel prices, but due to Stainless Steel's weak fundamentals and demand and supply lines, prices remained rangebound. Market participants claim that the coking coal they purchased in April will be used in the April-May production. As a result, production costs are likely to peak in May-June. Furthermore, the Indian government-imposed duties on finished flat and long steel and iron ore to reduce exports and shift mills' focus to the domestic market. Tariffs on coal and ferroalloy imports have also been reduced to contain rising domestic steel prices and lower production costs. Prices fell in June due to lower raw material costs and lower demand. Flawed demand, piled-up inventory, and a drop in iron-ore expenses, combined with the looming overhang of COVID-led disruptions in China and the ongoing hit to exports, are weighing on sentiment.
Europe
In the European market, the AL6XN Plate prices witnessed mixed sentiments. In April, the Russia-Ukraine war and its repercussions kept the prices soaring. However, due to low manufacturing demand and high inventories, AL6XN Plate prices fell in June. Market players cite that the augmented stocks throughout the supply chain are because of the initial panic buying activity. Fearing further price erosion, service centers and distributors resisted purchasing. Manufacturers have continued to suffer as a result of decreased downstream demand. Declining purchasing activity has further shrunk the June offer book. Meanwhile, to attract new customers, the mills reduced their quotation prices. However, long delivery times, the risk of tariffs, and capacity shortages at local ports keep the interest limited. Other factors impacting the market's interest are uncertain demand and price directions. However, the summer maintenance period is swiftly approaching. Producers are raising their outages to control production output by market demand.
For the Quarter Ending March 2022
North America
The AL6XN prices showcased a surging trend in the US market during the first quarter of 2022. According to market participants, the Russia-Ukraine conflict has driven market panic about supply shortages, resulting in soaring raw material prices, especially iron ore and coking coal. Increasing procurement risk, financial constraints, port blockades, growing uncertainty about availability, and rising safety and security concerns are among the significant factors driving sentiment in commodity markets worldwide. The Russia-Ukraine conflict and its repercussions on raw materials and logistics have significantly impacted supply and demand-side movements. However, market participants opted to wait and watch the approach until further clarification of the price trend.
ASIA PACIFIC
In Asian countries, AL6XN Plate prices increased during the first quarter of 2022 due to the increased demand. Rising raw materials and energy prices are primarily driving this upward trend. Amidst this, the extended hostilities between Eastern European nations further increased the cost pressure and inflation rate in the global market, prompting raw material prices to skyrocket. Furthermore, the Russia-Ukraine conflict and repercussions over input materials have impacted the supply-demand dynamics, raw material costs, and the global economy, resulting in a stretched supply chain. However, the robust demand for AL6XN from the downstream sectors kept the market sentiment for AL6XN bullish.
EUROPE
During Q1 of 2022, the AL6XN prices witnessed bullish market sentiments owing to the robust demand from end-users amidst the rising energy prices. Since 2020, energy and fuel prices have been surging, further aggravating increased inflationary pressure. Amidst this, the Russia-Ukraine aftermath, and its repercussions, particularly on raw materials and logistics, resulted in rising inflationary pressures, rising average purchase prices, and output charges. This conflict has severely impacted supply and demand-side movements and caused seller delivery times to lengthen to a near-record high. However, limited transactions and dull market conditions in the global market, with market participants adopting a wait-and-watch outlook for further price trends.
