US stainless steel processor buying prices increased across all grades in tandem with rising LME nickel prices on Tuesday.
The daily Davis Index for scrap 304 solids climbed by 0.4¢/lb to 52.9¢/lb delivered processor yard and moved up by the same amount for 316 solids to 73.9¢/lb for single truckloads.
The index for scrap 304 turnings also inched up by 0.4¢/lb to 47.9¢/lb and rose by 0.3¢/lb for 316 turnings to 66.3¢/lb delivered processor yard.
LME nickel prices increased by $118/mt from Monday with the official three-month LME Nickel contract settling at $15,822/mt on Tuesday. The official cash contract closed Tuesday at $15,791/mt, up by $138/mt from Monday.
Stainless steel processor buying prices have been rangebound despite the recent surges in the LME nickel market. Some processors attribute this narrow movement to the falling demand from mills, which has balanced the buying prices so far. Some participants also believe that large inventories and speculative demand have led to muted movements in stainless steel scrap prices.
A rebound in demand would be followed by steep price inclines, but if mill demand does not return, prices could fall further.