European stainless steel prices have recently stabilized, buoyed by projected supply constraints and unexpected demand spikes, yet the broader market remains under pressure.
Stabilization in Stainless Steel Prices
Over the past two weeks, European stainless steel prices have shown signs of stabilization, largely due to projected supply tightness following production cuts by Acerinox at its Acerinox Europa plant in Los Barrios, Cadiz, Spain, and a maintenance stoppage at Outokumpu's Finnish facility.
An unexpected increase in buyer interest in Germany led to slight price rises. However, the momentum is expected to fade as service centers delay purchases to next year amid persistent low demand across most regions.
Raw Material Insights: Stainless Steel Scrap and Ferro-Alloys
Stainless Steel Scrap
Despite low domestic demand, stainless steel scrap prices saw an unexpected boost last week, fueled by mounting export interest.
Ferro-Alloys
The ferro-molybdenum market has faced high price pressure, averaging $51.10/kg over the past month. Rising material costs and heightened Asian demand have driven prices up, challenging European producers who are focusing on lower-margin steels to sustain operations. Meanwhile, Indian ferro-chrome exports to Europe have contributed to excess supply, driving prices downward in early autumn.
Prices of high-carbon ferro-chrome (65% Cr) dropped by 8% in September, with further declines in October as producers in Kazakhstan and India slashed offers. However, with long-term contracts for 2024 expected to conclude shortly, a price rebound may be on the horizon.
Demand and Market Outlook
Demand for stainless steel and its raw materials remains subdued. Some European steelmakers may shut operations earlier for the winter due to low order volumes. This pessimistic outlook could prolong the market challenges for the remainder of 2024.
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