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Prospect of stainless steel market

Prospect of stainless steel market

Prospect of stainless steel market

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Prospect of stainless steel market: The market which was inherently weak at the beginning of the year is increasingly chaotic

See more: bảng báo giá sắt thép xây dựng

The COVID-19 pandemic is seriously affecting all nickel and stainless steel supply chains – once faced with a weaker outlook.

From nickel and chromium mining to stainless steel supply and demand, stainless steel production capacity and demand from end-use fields including transportation, energy and home appliances are all disturbed. The coronavirus crisis impact stems from a difficult start in 2020 when nickel and stainless steel prices have been under pressure, and stainless steel production continues to move from the West to Asia.

As the global economic activity responding to the pandemic has sharply shrunk – for example, the International Monetary Fund, which is now forecasting a 3% drop in the global economy this year – steel production has also stop working.

In the United States, the American Iron and Steel Institute reports that the US steel mill’s utilization rate dropped to 56.1% in the week ending April 11, down from 81.3% a year earlier. Steel mills in both the United States and Europe have ceased production operations to cope with the pandemic as stainless steel production goes down orbit.

According to the latest figures from the International Stainless Steel Forum (ISSF), stainless steel production in Europe has decreased by 7.9% in 2019 to just over 6.8 million tons while production in the United States has decreased by 7.6 % last year to 2,593 million tons. In contrast, stainless steel production in China increased by 10.1% in 2019 to 29.4 million tons, according to ISSF estimates.

Interruption of raw material supply

Supply disruptions in different raw material markets are complicating the prospects of the nickel and stainless steel industries. Concerning nickel production, at least two mining companies in the Philippines recently announced an indefinite closure, while Macquarie reported that two Canadian nickel mines (the Glencore’s Ragan mine and Vale’s Voisey’s Bay mine) ) has stopped working.

These supply disruptions added to the major nickel supply restrictions after Indonesia had export restrictions on unprocessed nickel ores. In response to the rapid change in nickel supply and demand, the three-month official LME nickel price has dropped from more than 14,000 USD / ton at the end of 2019 to below 11 200 USD / ton at the end of March .

Other stainless steel material prices have been under even greater pressure. As Macquarie reports, ‘the LME price is only relevant for a certain portion of sales, however, with 65 +% of nickel currently in the form of iron-nickel units other than LME (ferronickel, pig iron and nickel stainless steel). Scrap) ‘.

It is known that ferronickel has traded with a small difference from the LME price a year ago but is currently being sold at a discount of about $ 2,000 per ton.

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