So far in early 2015, stainless steel purchase tonnages have failed to pick up in the major consuming markets. Despite a burst of activity in the first half of January, this appears to have been the result of short-lived stock replenishment measures, which have now subsided.
The consensus view amongst market participants in the traditional stainless steel producing regions is that this year is likely to be only slightly better, in terms of sales volumes or prices, than 2014. Many believed, though, that something resembling a traditional first quarter upswing might materialise. However, demand has been disappointing and transaction values have followed raw material costs in a downward direction.
There are many factors contributing to the current lack of demand. Most of these result in caution on the part of buyers. The recent negative trend in raw material values, especially nickel, has, inevitably, made customers reluctant to commit to purchases, in case the bottom of the price cycle has not been reached.
The rebuilding of confidence in stainless steel markets in the short to medium term is largely dependent on the outlook for nickel. At present, the pure nickel supply remains in surplus and LME inventories continue to record all-time highs.