Source: MetalMiner IndX(SM)
Consumer confidence fell off a cliff in the month of October, dropping nine points from 80.2 to 71.2 as a result of the federal government shutdown as well as the imposition of yet another short-term solution for the debt ceiling issue. However, though consumer confidence plays a large role in key areas of the economy such as consumer spending and in particular, appliance expenditures, it does not seem to play as large a role in the monthly stainless steel index which recorded a three-point gain, primarily due to rising nickel prices.
The monthly Stainless MMI® registered a value of 82 in November, an increase of 3.8 percent from 79 in October.
Key appliance makers such as Whirlpool have recently reported record earnings due to strong sales growth in North America. Moreover, the company has experienced growth from housing, replacement and discretionary demand. In its most recent earnings announcement the firm pointed to several additional factors that it sees as positive for its own appliance sales including both improving demand trends as well as the stabilization of material costs (such as stainless steel). Additional analyses suggest Whirlpool has positioned itself well in the small appliance market that includes coffee makers, mixers and even cookware (think KitchenAid products). Many of these products also contain stainless steel (and of course aluminum as well).
The sole driver of the upward movement in the stainless index involves nickel prices. Those increased by four percent on the LME and just over three percent in China. All other metals within the stainless steel basket held steady.
At $14,570 per metric ton, the 3-month price of nickel increased 4.6 percent on the LME. After dropping the previous month, the price of Chinese primary nickel prices rose 2.8 percent.
With a 0.6 percent decline, the Allegheny Ludlum 316 stainless surcharge closed the month down.
Chinese ferro-chrome held pat last month. Prices for Chinese ferro-moly remained constant this past month as well. Chinese 304 stainless steel scrap remained unchanged. Chinese 316 stainless steel scrap experienced a flat month. Chinese 304 stainless coil traded sideways last month. Chinese 316 stainless coil did not budge the entire month. The Allegheny Ludlum 304 stainless surcharge held pat as well.
The Stainless MMI® collects and weights 14 global stainless steel and raw material price points to provide a unique view into stainless steel price trends over a 30-day period. For more information on the Stainless MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.