Comments on Ni and SS scrap markets 1

[EdStainless]

Since I follow these closely I thought that I would make some comments.
Ni price right now are back to where they were at the first of the year. From a high of $24/lb Ni has dropped to $15/lb.

Even steeper has been the fall in SS scrap prices. I don't know what scrap sells for, but I know what they are paying. At one point scrap peaked at about $1.75/lb for 304. This was the full market value for the contained Ni. Today scrap prices are nearer to $0.60/lb, or about half of the market value of the Ni.

Why? Well there are a number of factors. The Chinese are making a lot of Ni bearing pig iron, the large mining projects are actually progressing toward production, and inventories have risen (slightly). All in all people are less worried about not being able to get metal when they need it. The 'fear premium' is coming off of the price.

For how long? Well, if I used scrap I would be buying now. The big users are the stainless mills. All of them that I know of are on reduced summer production to allow for vacations and to reduce expensive inventory. I believe that they will come back to full production in September. This might not cause much price change in Ni, but it will surely raise the scrap prices. If you have scrap to sell I would hold on to it. After all the down side risks aren't much.

Hopefully this is the start of a more rational period for Ni prices. I don't know where prices will settle, I just hope that they settle. A bit of price stability would go a long ways toward helping the stainless markets.

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Rust never sleeps
Neither should your protection

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[weeeds]

Thank you for your insight. This is very helpful.

 

[EdStainless]

It looks like Ni is finding a lot of buyers in the $14.50-15.00 range. I don't expect prices to drop further in the short term.
If you buy Ni you might want to buy now.
If you are selling scrap you should consider holding off. The scrap discount will rebound when the big mills move back into the scrap market. Even at current Ni prices you should be able to get $1/lb for 304, so wait a while.

Notice that Mn and Cr price have moved up also. Mo isn't dropping either. It could be an expensive autumn this year.

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Rust never sleeps
Neither should your protection

http://www.trent-tube.com/contact/Tech_Assist.cfm

 

[kenvlach]

The 'Evil Empire' strikes back?

Russia metals bonanza raises hopes, fears
'Investors cheer the industry but security analysts worry Moscow may use its market clout to consolidate power.'

http://www.latimes.com/business/la-fi-russiametal13aug13,1,531365.story?ctrack=4&cset=true

 

[arunmrao]

As a result of sharp fall in Ni prices,there is now a new risk while sourcing 304 or other grades.

Many speculators(read black marketer) have lost huge sums of money as they had stocked large quantities and would not release,thereby creating artificial scarcity.

Now to set off some of these losses,200 series of material is being passed of as 304. This is Indan market,it can happen anywhere else too!!

" All that is necessary for triumph of evil is that good men do nothing".
Edmund Burke

 

[EdStainless]

Anyone watching Ni knows that I missed the call back in July. Ni has been soft for the last few month.
It looks like it is changing. The last few days in a row Ni has moved up. It is now flirting with $14/lb (it was under $12 at one point).
I am sticking to my previous story though. It still looks like a lot of buying activity in the $14-15 range.
If Ni inventories start to drop (they have been building) then the price may take off. In the near term look for scrap prices to recover (less discount to LME). If you scrap dealer isn't willing to give you more tell him that you will hold out and wait.
The big mills will be starting to melt in earnest again soon.

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Still trying to help you stop corrosion.
formerly Trent Tube, now Plymouth Tube
eblessman@plymouth.com
or edstainless@earthlink.net