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Stainless steel demand is expected to grow in September

Stainless coil demand has seen returning in September
The rock bottom for European stainless hot and cold rolled coil prices has yet to be reached and values will continue falling in June.
Some northern European flat steel sector sources believe the bottom will be achieved in July after scrap prices touch their lowest levels before the August holiday season, with a possible rebound in September. In the fourth quarter, the European and global markets are forecast to normalize in terms of supply balancing with demand.
The European stainless flats market continues to be sluggish for both coil and its derivatives sales. Activity is quiet in all countries, with clients ordering only back-to-back or not ordering at all. Lower consumption is forcing mills to cut production to balance demand and supply. Market sentiment remains grave.
According to sources, coil prices in Europe will lose €100-200/tonne ($107-215) more compared to today’s values. Scrap prices will also continue falling in June and July but the short scrap availability and coil production cuts will address overcapacity and generate some need for material after the holiday season. Buyers will procure material until July and then break for holidays, with purchasing to resume in September, thereby aiding a normalization of both scrap and coil prices.
“In order for demand to resume, European prices have to align with coil offers from the Far East, and we are [indeed] approaching the Asian levels,” a source comments. He adds that end-users do have some orders, but the moment’s challenge remains the pessimism and fear pervading the market.

Stainless CRC in northern Europe is at €2,500/t delivered on average and HRC at about €2,250/t delivered. Mills are quoting 4-6-week lead times. Prices of CRC from the Far East are at around €2,350/t CFR, sources suggest.

Source: Kallanish