Stainless steel prices continued to rise during March, but that may represent a peak, according to the London-based global metals tracking firm MEPS. In a report dated March 8, MEPS Steel Prices Online predicted alloy surcharges to increase at least up to April, with the surcharge representing a “staggering” 74% of stainless selling prices. However, basis figures were forecast to fall to compensate for the inflated cost that the alloy surcharge will add.

MEPS conceded that nickel prices exceeded its expectations in rising to new highs during February. Although nickel prices may remain elevated in the short term, MEPS expected the high prices “to take their toll on the stainless steel industry with stainless demand expected to slow over the coming months. This could help to alleviate the current nickel supply shortages and bring prices down as the year progresses.”

In the longer term, MEPS forecasted a decline in stainless selling values as nickel prices reduce as demand slows and de-stocking continues. Both basis figures and alloy surcharges should begin to decline into quarter four of this year, said MEPS.