Stainless steel pipe, fittings & flanges report: July 2017
Stainless prices for July have dropped steeply thanks to plunges in raw materials such as nickel, ferrochrome and molybdenum. The four big domestic producers (ATI, AK, NAS, Outokumpu) all announced surcharge decreases ranging between (8.45) percent to (12.52) percent for Types 201, 304, 316 and 430 products. Base prices were reported holding reasonably steady. Like carbon steel, stainless prices were thought to be impacted by the U.S. DOC’s Section 232 investigation, although it was unclear whether stainless would be included in any sanctions.
Nickel on the LME fell below $9,000 a ton for several days in June before slightly recovering late in the month, but nickel still is selling for around $2,000 less than the yearly highs of more than $11,000 reached in February. European ferrochrome was reported down (28.6) percent for the third quarter compared with the second.
According to London-based metals tracking firm BMI Research, Global nickel production is expected to increase for the first time since 2013. Analysts there expect worldwide nickel output to grow by an average of 3.4% between 2017 and 2021, citing a weakening in Indonesia’s export ban as the primary reason.
According to American Metal Market, U.S. silicon prices have reached their highest level since December 2015. The main reason is a decline in imports due to U.S. investigation of illegal dumping and subsidies from foreign silicon producers.
PVC resin prices seem to be stabilizing after dropping in the previous months. Demand appears to be soft with plenty of production. Although there may be some potential for a small decline in pricing, major moves in one direction or another continue to seem unlikely for the time being.
Currently, the production lines at HDPE extruders are as blistering hot as the mid-summer sun and the lead times are just as brutal. The price increases from earlier in the year have plateaued for a couple of consecutive months except for a few HDPE resin manufacturers, specifically Exxon and Formosa, which have put out the possibility of a 3-cent per pound increase for August. However, the HDPE resin index looks at the entire breadth of products, from milk jugs to plastic shopping bags and the piping market is just a small segment of the overall mix of uses for HDPE.
So while the piping market is at peak levels of demand, the remaining HDPE non-piping products are down to flat, which seems to indicate the August increase will probably not happen. Lead times for standard piping products from most manufacturers are still six to eight weeks, if you are fortunate, but in many cases, they are 10 to 12 weeks. All extruders are running around the clock to meet demand and some now are putting out prices well above the high end of the market so as to keep distributors from extending their backlogs beyond what they can promise.
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