Market trends

The Glass is half full again…

Market Situation: ‘The glass is half-full again’as the current order intake and sales volumes are better than in the first half of this year,but still far frombeing satisfactory. Additionally, the European demand has softened again after the ‘minibubble’ burst in earlyOctober.

Atemporaryre-stockingperiod came to an end and orders from end users are still a ‘hand to mouth’ business – especially in the process equipment segment. Volumes per order are a lot smaller than they used to be and major projects can not be expected before HY2/2010 in Europe.

 

Demand in 2009: European and NorthAmerican demand, excluding stock effects, will drop by more than 20% this year, compared to a global demand decline of less than 10%.With a production growth around 25%, China has been the major production driver in 2009. However, the real demand there does not fully reflect this extraordinary increase (real demand +1million tonnes, production ~ 2 million tonnes). Chinese production of fabricated stainless steel products (such as washing machines, refrigerators, catering and process equipment) indicate that a growth of ‘only’ 10-15%. This indicates that around 1 million tonnes of stainless has been put in stock in recent months in China alone.

 

Excluding China, the stainless demand in rest of the world dropped by almost 20% this year (similar to Europe). Despite recent increases European Stock Levels are considered to be on the ‘lowside’. But,
uncertainty about the price direction prevails and few stockists are re-stocking before the end of the year. Plus,despite the previouslymentioned gradual recovery, there is not sufficient stimulus from demand in Europe and North America to justify up-stocking in the near future...

 

Beside a detailed market analysis, there are also information available of SMR's Monthly Price Census: 

 

Grade 304 prices (sheet, 2mm, ex stock) stagnated in October (-1%to 2,340 €/t) compared to September (2,370 €/t) in Europe. This minor price movement was caused by falling raw material surcharges, whilst base prices remained stable in October. In Asia, market prices reacted faster to changing market conditions: sheetprices fell by US$ 200 per tonne to a level of US$ 2,900 per tonne.

 

 

 

And financial Results for the 3rd Quarter 2009 of major companies like Thyssen-Krupp and Outokumpu, and company news.

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