For the Quarter Ending March 2023
Stainless Steel (Flat) prices in the US market remained stable in Q1 2023 due to steady demand from the construction industry, despite the financial turmoil in the US banking industry. Mill margins were under pressure due to rising input costs and the use of more scrap in furnaces. Stainless steel inventories were slow to deplete despite a significant drop in imports, and cautious buyers kept mills open to individual, non-contract negotiations. Multiple buyers were going through order books to decide how to approach buying over the next few months, as many were concerned that pricing could peak and fall off in the late second quarter and the second half of the year. As a result, SS 304 HR Plate prices for Ex Texas settled at USD 3990/MT.
In the Chinese market, the Stainless Steel (Flat) prices were bearish due to high inventory levels and subdued downstream construction demand. Stainless steel manufacturers issued limited goods last quarter, and this quarter's supply release is expected to be sparse. Despite post-holiday optimism, some large stainless-steel mills scheduled production with caution due to scarce raw materials. Spot transactions were slow, and overseas demand was weak. Although prices fell slightly in March, they remained higher than spot transaction prices, and the majority of buyers were waiting for further price drops. Increased production has also dampened demand, and March was a challenging month for sellers. However, price recovery is expected after the second week of April.
In Q1 of 2023, the Stainless Steel (Flat) prices in the German market showed a stagnant price trend due to limited supply and firm downstream inquiries. Spot supply of raw material pure nickel from the overseas market was limited, leading to subdued upstream demand for coil and downstream demand for tube and sheet in northern and southern Europe. European mills' attempts to increase flat prices mostly failed, with most countries showing stable values compared to January, May, and June lead times being quoted. Some market players saw normal consumption returning following the post-pandemic rush, while others considered keeping prices stable a significant achievement and believed that the flats market would not absorb any hikes. Downstream demand was sluggish, with falling prices observed. Mills, service centers, and re-rollers predicted a negative April due to low consumption during the seasonally short month of Easter.
For the Quarter Ending December 2022
As the fourth quarter of 2022 ended, Stainless Steel (Flat) prices showed a dwindling price movement due to falling downstream inquiries and higher inventories. Buyers were focused in October on reducing inventories across all flat products through the end of the year, which kept them out of the spot market. Mills had attempted to remain competitive with import offers despite falling scrap prices, as downstream demand from new projects did not warrant additional spot buys or bookings of larger imports or rising financing costs. Mill margins were under pressure as input costs rose and the continued push to use more scrap in furnaces. According to manufacturers, downstream demand was difficult, and any increase in scrap was likely to erode mill margins. Thus, the SS 304 HR Plate (6 x 1250 x 2000) prices for Ex Texas (USA) settled at USD 3978/MT.
Stainless Steel (Flat) prices in the Chinese market edged downward in the fourth quarter of 2022 due to higher inventory levels and limited purchasing activity amid COVID-19 control and prevention measures. Stainless Steel (Flat) prices rose in October due to an unexpected arrival following the festival, a shortage of certain specifications, and raw material supply concerns. The demand effect in the favorable trading seasons was fading as the traditional slack season began, and overall demand for stainless steel was weak. The domestic epidemic situation was complicated. Logistics were clogged, downstream procurement willingness was low, and the transaction required robust inquiries. On the demand side, stainless steel prices rebounded more in mid-December, influenced by futures prices, providing some profit margin to NPI plants. Thus, the SS 304 HR Plate (6 x 1250 x 2000) prices for FOB Shandong settled at USD 1576/MT.
In the fourth quarter of 2022, Stainless Steel (Flat) prices showed stagnation in the German market due to limited buying inquiries and higher inventory levels. Buyers who ordered SS HRC for December delivery reported that the material was already available in early Q4, with lead times from several mills as low as two weeks. Despite the falling prices and short lead times, inquiries from downstream players remained low. Order cancellations also resulted from energy cost uncertainty and demand destruction. In December, some mills planned to keep Christmas production shut down for longer than usual. Given that supply still vastly outnumbers demand, market participants remained pessimistic about the impact of such prolonged stoppages on prices. Some mills have stopped trading and will re-enter the market in the first half of January. Due to the ripple effect, the SS 304 HR Plate (8 x 1350 x 2000) prices for Ex Ruhr (Germany) settled at USD 3361/MT.
For the Quarter Ending September 2022
Stainless Steel (Flat) prices fell in the North American market as the market remained uncertain due to continued low demand. Buyers refused to make purchases that would have increased their inventories, preferring to keep stocks tight rather than risk investing in an uncertain market. Some buyers have started contract negotiations for 2023, with at least one source reporting a 4% price reduction for value-add tonnes. When negotiating 2022 contracts last year, steelmakers reportedly reduced many contract purchasers' discounts to lower levels, with some buyers receiving no deals. Many buyers refuse to make purchases that would increase their inventories, preferring to keep stocks tight rather than risk investing in an uncertain market. Towards the end of the third quarter, the market price of Stainless Steel (flat) was 4300 per MT Ex-Texas (USA).
During the third quarter of 2022, Stainless Steel (Flat) prices declined in the Asian market due to the subdued demand outlook. As per manufacturers, the operating conditions have deteriorated with a further fall in steel prices and rising coking coal prices. The demand continues to remain muted. Meanwhile, the Indian producers capitalized on the opportunities in the export markets against the backdrop of the ongoing energy crisis in Europe. However, due to the imposition of export duty on finished goods, there has been increased potential for semi-steel export. Monsoon season somehow pressured a few stainless-steel manufacturers to reduce production by 25-30%. Towards the quarter end, the prices of Stainless steel (flat) were USD 3244 per MT, Ex-Mumbai (India).
Stainless Steel (Flat) prices in the European market fell in the third quarter of 2022 due to a sluggish demand outlook, higher energy costs, inflation, and a new green deal. According to market participants, service centers and large distributors suffered from margins squeezed by rising raw material costs. Market participants stated that the production cuts implemented by some steelmakers were insufficient to make the industry profitable and sustain steel prices, suffering due to high energy costs, a lack of demand, and high stocks. Market participants were particularly taken aback by the lack of production cuts in North Europe, where prices had been lower than in Italy since early September, which was unusual. Final prices of Stainless steel (flat) were USD 3380 per MT, Ex-Ruhr (Germany).