US stainless steel processor buying prices inched up on Tuesday in tandem with rising LME nickel prices.
The daily Davis Index for scrap 304 solids inched up by 0.1¢/lb to 77.3¢/lb delivered processor yard and climbed for 316 solids by 0.8¢/lb to $1.001/lb for single truckloads.
Scrap 304 turnings increased by 0.2¢/lb to 73.4¢/lb and grew for 316 turnings by 0.1¢/lb to 90.4¢/lb delivered processor yard.
LME nickel prices increased by $431/mt from Monday with the official three-month LME Nickel contract settling at $18,159/mt on Tuesday. The official cash contract closed Tuesday at $18,142/mt, up by $419/mt from Monday.
Demand for June has reduced by 5-10pc against May due to maintenance-related outages at mills. This may lead to excess inventory in the market. Additionally, chrome prices are also expected to weaken in Q3, which could put downward pressure on stainless steel scrap. As a result, processors are buying cautiously to avoid an inventory build-up in June. Still, LME Nickel prices, which have risen over the past week are expected to lift stainless scrap prices.