Scrap stainless steel offers good prospects

Metals and Mining Review | Wednesday, March 23, 2022

The year 2022 has so far seen a mixed picture for the stainless steel and superalloy scrap sector but, generally, recyclers continue to benefit from the global economic upturn as the pandemic eases

FREMONT, CA: According to the industry insiders, in Europe, as a result of the continuing negative effect of the pandemic, this year began with lower-order intakes for leading stainless steel flat producers. Simultaneously, the production of stainless steel witnessed a significant increase. Other negative factors that contribute include an increase in the imports of the finished goods in stainless steel for a fifth consecutive month as well as price levels for the finished goods in the Far East considerably below the European market levels and the stocks of the finished items in Germany attaining new highs.

Ferrous scrap prices have stabilised, but ferrochrome values are likely to fall by the end of March due to excessive pricing differentials with other main markets such as India and China.

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According to the president of Spectrum Alloys, in the United States, higher prices and inflation nearing their highest level in 40 years have had a pronounced impact in the commodities space with mixed implications for US recyclers. While nickel and stainless steel scrap prices have risen, boosting recycler profits, energy prices have also risen, raising operating and transportation costs, he writes in the Mirror. 'Transport bottlenecks continue to stymie enterprises' ability to deliver material to domestic and international consumers on schedule.

According to Census Bureau trade data, the value of US stainless steel scrap exports grew 24 percent in 2021 to more than USD 340 million (EUR 300 million), but the number of abroad stainless scrap shipments decreased 3 percent to 304 000 tonnes. Improved demand from regions such as India, Mexico, and Canada more than offset shipping challenges and decreased demand from Taiwan.

According to the Mirror, the market condition in Asia is pretty similar to what it was in the fourth quarter of 2021. Prices are significantly behind those in the United States and Europe due to limited demand from China. Meanwhile, Indonesia has been compelled to explore alternatives to China, culminating in the export of stainless hot coils and nickel pig iron to other Asian countries, particularly Taiwan.

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