The Davis Index for stainless steel scrap imports rose by 1-7pc for the major grades on higher stainless steel demand in India. Several shipments were booked despite high offers from US and European markets. Demand for stainless steel scrap has gradually risen over the month with uptick in prices since August second week.
Another factor supporting scrap prices for nickel-based scrap is the LME nickel gains. The official three-month LME nickel rose 2pc or by $305/mt and settled at $14,906/mt on Monday from the week prior.
The Davis Index for 304 (18-8) solids rose by $11 on Tuesday to $1,255/mt cfr India port from the week prior. Demand pushed index prices higher but only marginally for SS 304 and 316 solids. In the previous week, sources told Davis Index that prices would rise in the following weeks as orders from Indian mills substantially grew.
The average global nickel price is rising on the back of huge demand for nickel batteries for electric vehicles. Nickel prices in Shanghai and in London rose to their highest since November 2019 on the back of falling inventories at Chinese ports and expectation of higher demand, said traders.
Stainless steel margins have improved recently which will support nickel demand in the future, according to ING analysts. Stainless steel is a major consumer of nickel but there are high inventories of stainless steel globally due to low consumption during COVID-19 lockdowns. Increasing stainless steel production capacities in Indonesia is, however, adding to the inventory pile-up which may keep prices of scrap in check.
Sources told Davis Index that stainless steel inventories in India are gradually depleting and therefore, mills are ramping production which is driving prices higher for imported scrap material. In India, demand for stainless steel across all sectors is rising, said market participants, who also projected demand to rise further by the end of Q2 and in Q3. Also, petrochemicals, surgical and demand from paper industry is strong. The Davis Index for 316 solids rose by $11/mt on Tuesday and settled at $1,849/mt cfr India port on Tuesday from the previous week.
The Davis Index for 304 (18-8) solids on Tuesday rose by $15/mt to $1,205/mt cfr Taiwan port and the index for 316 solids remained flat at $1,820/mt from the week prior. Prices of 316 were also influenced by global molybdenum prices. The official three-month LME Molybdenum fell 4pc to $7.75/lb on Monday from the week prior which could be a reason why 316 import prices in Taiwan remained flat. 316 solids have a minimum of 2-3pc of molybdenum.
The Davis Index for Zurik Tuesday rose by $5/mt to $1,050/mt from the week prior as nickel and copper prices rose. The official three-month LME copper rose by $131/mt to $6,559/mt on Monday supporting prices of Zurik.
The Davis Index for 430 solids settled at $439/mt on Tuesday, up by $30/mt from the prior week. Importers are bidding at around $410-420/mt while the offers from Vietnam and Korea remains above $450/mt. Demand has improved for the grade but is still lower compared to pre-COVID levels.