Asian Stainless Steel Prices at Highest since 2008

The stainless steel market is a global one, involving myriad complex and interdependent factors all over the world. This means that a change in the price of the vital metal that occurs in any part of the world is bound to have knock-on effects that traverse the globe.

MEPS Asia has recently published figures that show the average prices for both cold- and hot-rolled coil of Grade 304 have hit the highest levels recorded since August of 2008. The rate of these increases has continued to accelerate, with rising nickel prices being cited as the predominant driver of the spikes.

In South Korea, the transaction values of cold-rolled coil have rise by 17% since 2022 began, reaching the highest level in fifteen years. It has been reported that end-users have found themselves unable to recoup the cost of the inflated prices for stainless steel. POSCO, the country's domestic producer, attempted to support local customers by announcing that selling values had remained stable in May. Prices are however set to rise in June as POSCO seeks to absorb the recent increases in the costs of raw materials.

The prices for flat stainless steel products in Japan have skyrocketed by 30% year on year, reaching their highest level since June of 2008. Increases in the price of austenitic grades at some domestic mills were around JP¥20,000 (around £125.40) per tonne in May. As the value of the yen against the US dollar continues to decrease, further price rises are predicted.

Taiwan has experienced the largest rises in East Asia so far in 2022, with domestic prices for stainless steel coil in the 300 series increasing by a massive 63% year on year; over 50% of this increase happened during the first four months of this year.  The purchasing activity of distributors is being limited due to their concern about being left with high-cost inventory.

Significant price increase since 2022 began have been recorded in China though have been curtailed by reduced demand. China's stainless steel consumption and production have been impacted by COVID-19 restrictions, which have caused logistical problems in terms of suppliers' ability to deliver material.

MEPS Asia has forecast that transaction prices for stainless steel will continue to increase in June, with changes in domestic values varying from region to region as steelmakers seek to recoup input expenditure. As the gulf between international and local prices widens, opportunities for export are likely to increase, helping to alleviate Asia's growing pressures due to over-supply.

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