stainless steel is at ridiculous levels right now. We use it alot at the factory I work at and we just had a plant meeting reguarding the price (going to kill buisness). Although there is hope, sources are saying the price is going to fall out soon...just dont know exactly how soon
I sell Stainless for a living, prices are not going to drop any time soon, they are only going up. See the info below. FYI Type 304 stainless has 8% minimum Nickel.
Price of stainless on the rise still.
Nickel has been on a bull run since the end of 2005, when prices hovered
around $11,500/ton. Dwindling stocks and strong demand from the stainless steel
sector have been a key factor in the market's dramatic rally.
LME nickel prices have enjoyed a roughly 33% rise from the start of the year
which analysts said looks to continue, as the market enters the second quarter.
"A seasonal pick-up, in what is usually the strongest quarter for demand,
suggests that the second quarter of 2007 will see further price appreciation
from current levels with the potential for price spikes of the kind seen
recently in nickel spreading to other markets," Barclays said recently.
However, record high nickel prices mean that some consumers, notably in
China, are starting to use cheaper pig iron instead to manufacture stainless
steel.
So far, it's mainly been used to make 200 series stainless steel, which has a
lower nickel content than the more traditional 300 series but can be used in
similar applications.
"There appears to be growing interest in using nickel pig iron by major
stainless steel producers in China including Posco (PKX), Tisco and Baosteel,
to replace primary nickel to produce 300 series stainless steel in an effort to
cut production costs," Macquarie said Monday.
Increased use of pig iron would be a bearish factor for the nickel price,
analysts said.
"Demand destruction is inevitable at these price levels," said U.K.-based
BaseMetals analyst Will Adams. "The market had best be prepared for the
possibility that 50,000 tons to 70,000 tons of nickel demand could be removed
if China continues to use pig iron to make stainless steel," he added.
But given that only limited new nickel supplies are expected to come through
over the next couple of years, the market looks set to remain tight in the near
term.