Rolling mills world wide are now taking seriously market demand for low or non nickel grades of stainless steels as customers react to the effects of rising nickel prices
Outokumpu, which has traditionally been mainly a supplier of austenitic grades, is to increase its production of ferritic types.
This has involved a significant investment in new equipment.
Output of ferritic grades is also to be expanded from the new melting shop at Lianzhong, in China.
EU coated products prices stabilise
European Union average hot dipped galvanised and electrozinc coated product prices stabilised during May, 2007, and are likely to stay stronger than electrozinc as the market for the latter is weaker
Global flat steel prices stay steady
Real consumption of flat steel products, which has failed to recover, remains lacklustre and now scrap costs have started to slide, with two consecutive monthly drops
Global supplies of 300 series material have in the past formed 75% of total stainless deliveries.
It is interesting to note that Thyssen Krupp recently announced that it may lift output of nickel free steel from the existing figure of 30% up to 35%.
We have reports that an Arcelor Mittal senior executive sees the potential to push up production of non nickel grades to 70% in the long term.
The growth in nickel demand in the future is likely to be slower than the overall expansion of the stainless steel sector.
This is even more probable now that the producers are investing in new facilities to manufacture ferritic specifications.
This fresh capacity will be actively promoted by the mills which was not the case in the past.
This situation proves the point that clever speculation on the LME can only work for a limited period.
Any commodity can be priced to unacceptable levels but eventually market fundamentals will prevail.
When the price of a product becomes excessive, buyers will seek out substitute materials or in this case grades.
* Source - MEPS Stainless Steel Review.