Stainless steel fasteners price information update
20 October 2016
Here, Paul Lower, chief executive at Apex Stainless Fasteners Ltd, gives his take on stainless steel prices. Monomoy Capital Partners has announced that it has completed the sale of ContMid Holdings Inc (CMG) to Agrati SpA for an undisclosed amount.
The global supply/demand imbalance for stainless steel fasteners has largely been eliminated in recent weeks with underlying prices moving significantly
upwards since the beginning of August, in the face of a number of factors directly impacting unfavourably. Nickel price has risen to in excess
of US$10,000 a tonne, while the recent scrap recycling shortage appears ongoing, coupled with increasing container transport costs.
The impact of the latest Section 337 stainless steel case on the USA supply chain has in essence created a knock on effect, resulting in lengthening
lead times as alternative supply sources have needed to be established. This coincides with most major European stainless fastener wholesalers
placing significant purchase contracts to achieve deliveries in advance of the GSP changes announced on Indian derived product ahead of the 1st
January 2017 deadline.
Tightening supplies of stainless steel due to mining closures in the Philippines on environmental grounds, together with increasing consumption in
China, appear to be driving nickel prices upwards. The effect is global and it is becoming increasingly evident that delivered finished product
prices into Europe will continue to move gradually upwards over the next six months.
Certain markets, notably the UK, have been faced with unprecedented movements in exchange rates in recent weeks, which are significantly compounding
the impact on GBP delivered costs – with the consequence that as new stocks arrive the price differentials in the UK appear destined to reflect
by the end of 2016 somewhere between 12% and 18% ahead of quarter levels, depending on the product group.
The majority of European stainless fastener wholesalers have already increased prices in August and it is highly probable that further increases will
follow during the fourth quarter of 2016. The currency movements with regard to the UK market will almost certainly necessitate further upward
movements in GBP wholesale prices early in September 2016.
www.apexstainless.com
