Research

Forecasts and market analysis based on price assessments from Fastmarkets MB and Fastmarkets AMM

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December 2016 | Stainless Steels


A good year for suppliers, by recent standards: Asian Highlights


The cost-based “support” in the four weeks after Chinese stainless prices peaked – of $100/t – counted for little, however, as Chinese mills and resellers struggled to compete in the northeast Asian landscape.

Margins dipped into December as expected but are on their way up again
In last month’s issue we pointed out that unless export market prices were to pick up, Chinese domestic market prices were bound to dip, such has been the importance this year for Chinese suppliers of sales abroad. After reaching a near two year peak in early November, when spot prices for CR304 2mm/2b coil in Wuxi moved above $2,000/tonne excluding sales taxes for the first time since February 2015, a downturn resumed.

Illustrating the importance of fundamental factors within stainless cold-rolled markets, this downturn occurred precisely at the same time as raw material prices and therefore replacement costs were actually rising. Indeed from the dollar equivalent of just $995/tonne as of mid-September, local nickel pig iron and high carbon ferrochrome used in the production of 304 austenitic stainless flat production rose to...

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