STAINLESS STEEL PRICES SET TO STABILISE AFTER A YEAR OF GROWTH – MEPS

According to MEPS, alloy surcharges, for grade 304 flat products, in Europe and North America, will decline, marginally, for March contracts. This, because average LME nickel prices, during the reference period, were slightly lower than those during the previous month. Producers may try to lift basis figures in order to maintain stable transaction values. Ex-mill prices in China and Taiwan receded, this month, as purchasing activity levels were disappointing, following the Lunar New Year holidays.

Although these figures suggest a slowing in the most recent upturn in stainless steel prices, sellers will be encouraged by the positive trend displayed during the past twelve months.

February’s transaction figure for type 304 cold rolled coil in Germany is over 33 percent higher than that recorded at the same time last year. The value reported in China, this month, represents a similar increase, compared with the figure in February 2016. An even greater year-on-year advance, of more than 40 percent, is shown by the price reported for the United States, in February.

Raw material costs are an important factor in these increases. The LME nickel monthly average cash figure, for this month, is estimated at US$10600 per tonne – a gain of more than 27 percent, compared with the number for February 2016. Furthermore, the European quarterly ferrochrome contract price, for the first three months of this year, is nearly 80 percent higher than the figure for the same period, in 2016. This number is now used in the calculation of alloy surcharges in North America, as well as in Europe.

The leap in ferrochrome values, for the current trimester, will represent a high point in the current cycle, with prices forecast to soften, during the coming year. Nickel costs, on the other hand, are expected to continue on an upward trajectory. The situation regarding mine closures, in the Philippines, is ever-changing but our belief is that it will continue to contribute to supply tightness.

Our research reveals an optimistic outlook from many parts of the global stainless steel supply chain. Underlying demand is perceived to be strong, particularly in Europe and North America. Conversely, trade cases against Asian stainless steel producers, in many parts of the world, have resulted in oversupply in the Far East.

Falling chromium costs are expected to offset rising nickel values, over the next twelve months. With basis numbers predicted to be quite stable, we forecast little change in global stainless steel transaction prices, in the coming year.

Source: MEPS – Stainless Steel Review – February Issue

PROCUREMENT ACTIVITY REMAINS UNSETTLED IN EMERGING STEEL MARKETS

According to MEPS, Russian trading houses expressed reservations over the necessity of the latest round of price hikes. The majority stress that the initiative is unsustainable and does not reflect real demand. End-users are exhibiting little urgency to purchase material, even with discounts granted.

The Indian steel market has been unsettled by pre-budget expectations, weak market fundamentals and volatile raw material costs. Attention is being paid to the negotiation of coking coal and iron ore contracts.

The outlook for the Ukrainian market is unchanged. Long product steel sales fell and are unlikely to recover until the construction season restarts. Meanwhile, steel production has been disrupted due to raw material shortages.

The business climate remained unsettled in Turkey, this month. Local service centres plan to keep stocks low in the near term and are purchasing cautiously. Construction demand is lower than anticipated. Flat product buyers are reluctant to take positions, amid changeable domestic and foreign quotations.

Price volatility unsettled buying activity in the United Arab Emirates, this month. Local traders are extremely reluctant to purchase material in, what they deem as, precarious trading conditions. Several firms plan to observe the global reaction to the re-opening of the Chinese market. In early trading, Emirati rolling mills opted to lower their selling figures.

Source: MEPS – Developing Markets Steel Review – February Edition

UPWARD PRICING MOMENTUM SLOWS IN THE NORDIC STEEL MARKET

Northern European steelmakers continue to push for increased selling figures. However, MEPS notes that prices for hot and cold rolled coil, across the Nordic region, were unchanged during the past four weeks.

By comparison, mill price hike initiatives were, partially, successful for coated coils. Availability of hot dipped galvanised material is restricted. Consumption by the automotive sector is strong.

In the plate market, robust demand and earlier raw material cost increases enabled producers to secure price rises, this month.

Declining scrap prices, in late January / early February, led to reductions in Danish long product selling figures. Elsewhere in the Nordic region, transaction values were relatively stable. Construction activity remains strong, with no serious disruption from the weather, so far, this winter.

Source: European Steel Review Supplement – February Edition

Saarstahl’s Neunkirchen Works produces with new wire rod outlet

Saarstahl AG, Germany, has successfully rolled the first bar on the single-strand wire rod mill supplied by SMS group at its Neunkirchen Works.After the new loop cooling section had been commissioned on schedule at the beginning of 2016 as part of the first construction phase, the second phase of construction has now also been successfully completed so that dimensions from 14 to 27 millimeters in diameter can now be finish-rolled on a MEERdrive®PLUS block. On the second day, 16-millimeters-diameter wire rod was already being rolled with a tolerance of ± 0.05 millimeters. The first defined objective of the new wire rod outlet, namely closer tolerances for the wire rod dimensions, was thus achieved. This second construction phase represented the most extensive modernization step. The heart of the installation is a four-stand MEERdrive®PLUS block with quick-change facility that rolls finished dimensions from 5.5 to 27 millimeters in diameter. Together with new movable cooling sections, a high-speed shear upline of the MEERdrive®PLUS block and two movable loop laying heads, Saarstahl can now react faster and more flexibly to the demands of its customers.

The new loop cooling conveyor with 3-fan technology and the cooling and equalizing sections now allow the mechanical properties to be influenced online, with a resulting improvement in the quality of the finished material.

Revamping of the wire rod mill will be completed in the third construction phase with the repositioning of the existing ten-stand finishing block with upline shear during the course of 2017. All dimensions above 5.5 millimeters in diameter can then be finish-rolled on the MEERdrive®PLUS block.

The SMS group is a group of companies internationally active in plant construction and mechanical engineering for the steel and nonferrous metals industry. Its 14,000 employees generate sales of over EUR 3.3 bn.

Source: SMS Group

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Silva Mash orders welded tube mill from Danieli

The new high-productivity ERW line will produce niche tubular products mainly for high-end automotive and furniture applications
Silva Mash orders welded tube mill from Danieli.

The new high-productivity ERW line will produce niche tubular products mainly for high-end automotive and furniture applications
With an actual capacity of 60,000 tpy of high-quality tubes delivered to the main European automotive and furniture manufacturers, Silva Mash is one of the largest welded tube producers in Bulgaria.

The new Danieli W+K “ERW 45/2.5-150” mill is designed to produce round, rectangular, square, semi-oval and elliptical high-quality and high-strength tubes with superior surface finishing, ODs ranging from 10 to 45 mm and WTs from 0.5 to 2.5 mm.

With a velocity reaching 150 m/min, the new line is able to offer superior diameter/wall thickness ratio capability which along with quick product change-over time (less than 60 min) results in great product flexibility.

In order to achieve the high level of productivity requested, the line is composed of an entry line with a double decoiler, strip joiner, horizontal accumulator, heavy duty forming section with break-down, fin pass, welding and sizing stands, a cut-off and evacuation system including a packaging machine.

Simplified, cost effective ERW mill configurations are also available for commodity tube producers.

Source: Danieli Group

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EU FLAT PRODUCT STEEL PRICES EXPECTED TO PEAK IN MID YEAR

According to MEPS, Restricted availability continued to boost strip mill product prices in most European countries, in February. Supply remained extremely tight and domestic mill delivery lead times stretched well into the second quarter. However, third country imports, from sources not affected by antidumping measures, are becoming more interesting to steel buyers. In many instances, prices are lower than those being sought by domestic steelmakers. Moreover, delivery lead times from outside the EU compare quite favourably with domestic ones, at present.

Local producers want to implement further advances as soon as possible, despite fairly stable input costs. Inventories at service centres and consumers are sufficient, currently, due to heavy purchasing at the start of the year. Buying activity was quiet, in February. Consequently, it is too early to judge whether the new target values can be secured for all strip mill products. The extremely restricted supply situation, in the hot dipped galvanised coil market, makes this the most likely product for successful implementation of the increases.

Source: MEPS – European Steel Review – February 2017 Issue