Stainless steel commodities remain stable in a slight upwards trend
On the 22nd April, after considerable delay, the South African chrome producer Merafe Resources Limited announced the European bench mark price for ferrochrome for the 2nd quarter of 2020. The reference price rose from USD 1.01/lb in the previous quarter to now USD 1.14/lb. This is a rise of 13 US-cents or 12.9%. Despite this strengthening of price, availability of stainless steel scrap remains low, with certainly firm buying interest in Europe. So far, effects of COVID-19 have been predominantly seen on the procurement side. Logistics have played at best a minor role in this.
Whether, when and for how long sales will be affected also depends on the speed of the restart and recovery of global economies. We are also approaching the summer months, so that, independent of the pandemic, there is also an expectation of a certain transitory seasonal weakness. The London nickel price has proven to be volatile in the last few weeks, but within quite a tight range. The 3 months future has been trading consistently between USD 11,800.00/mt on the downside and up to USD 12,500.00/mt on the upside of the price corridor. At the moment, the price for a ton of pure LME brand nickel is at about USD 12,200.00/mt. In view of the real economic background and the experience of slightly comparable phases, it could be said that waters are calm.