US stainless prices set for June increase

31st May 2024

US transaction values will rise in June in line with published alloy surcharges, following recent increases in raw material costs.

Assuming stable basis values, prices for grade 304 cold rolled coil will increase by USD153 per tonne, while those for type 316 material will jump by USD274 per tonne.

This will be the third consecutive month of price rises.

The recent spike in nickel values is a major factor driving these increases.

The latest surge follows the ban on Russian nickel by the London Metal Exchange (LME) and the Chicago Mercantile Exchange (CME), along with civil unrest in New Caledonia, a key nickel producer.

Stainless steel flat product prices in the United States remain high compared with those in other countries, despite upwards movements in other regions in May.

The gap between US prices and those in other countries is expected to widen further in June, as the increase in the US published alloy surcharge is likely to be larger than any potential rises in Asian and European transaction values.

Consequently, the United States remains an attractive market for exporters.

Several MEPS respondents noted an increase in overseas material arriving in May.

However, a rise in shipping delays and a significant upsurge in container prices may dampen imports in the coming months.

Rising transaction values would normally encourage more purchasing activity as buyers attempt to purchase ahead of further increases, but so far there has been very little change in end-user requirements for coil.

Several buyers witnessed an increase in hot rolled plate demand in April but said that it had declined again this month.

US GDP growth slowed to an annualised 1.6% in the first quarter of this year, down from 3.4% in quarter four 2023.

Among the G7 economies, however, the United States recorded the strongest expansion over the past year, and this trend is expected to be maintained in 2024.

Market participants state that US domestic producers appear to be content with their bookings, although some commented that one mill in particular seemed to be trying to increase its market share by offering some customers attractively priced deals.

This contradicts its recent strategy of reducing discounts for other customers.

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