Stainless on the Slide?

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Ferrous Metals, Global Trade

Stainless steel prices will be flat this year but rise in early 2009 said MEPS this week in a brief report, blaming the current weakness on soft seasonal demand in Europe and a weak US housing market. We wouldn’t argue with the soft seasonal demand but we feel it goes further than that. Though nickel prices have been falling, the price of stainless has been supported by a rising chrome price, but that too appears to have hit it’s peak and supply disruptions notwithstanding an easing in chrome prices would see stainless continue to slide well into next year. Global stainless production has continued to rise in spite of severe cut backs by China according to purchasing.com. Outokumpo the Finnish producer is saying the world is in over supply and without an increase in demand, prices are likely to continue to slide. Distributors are living hand to mouth avoiding stock replenishment in the belief prices will continue to ease, so the advice to consumers is do the same. Tomorrow’s price may be lower than today’s!

–Stuart Burns

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