Staying Stable with Stainless Steel
Over the past few months, the industry has been exhaling a long collective sigh of relief as the price of stainless steel first stabilised and then began to increase. As we maintain a consistent approach to pricing for customers in the UK in order to offer a buffer zone against the instability of metal prices, the rise in price will affect international customers though the current weakness of GBP against USD and EUR means that they are already getting an even better price than usual from BS Stainless.
Several reasons for the rise in cost of stainless steel have been identified. Working in complex conjunction with one another, these factors continue to interplay and many other variables mean that a close eye is being kept on the financial markets as well as political situations all over the world.
Definitely identified reasons for the price increase include:
- Higher Demand.
There is no getting round the fact that we are pretty much reliant on stainless steel. It is an essential material in so many items that we use daily without thinking and we want more and more of these items so demand is always rising.
- Material Shortfall.
The stronger demand has inevitably led to a lack of ready goods. As is true of any commodity, a decrease in availability leads to an opposite and correlative increase in value. Lead times have been extended and material scarce.
- Raw Materials.
You can’t make stainless steel without nickel and the price of this fundamental material has seen a steady rise, increasing alloy surcharges.Nickel makes up around 8-10% of stainless steel with prices of Nickel increasing around 45% this year this drives the overall price upwards. Nickel and other commodities such as Chrome and Molybdenum used in 316 trade in USD a further blow for UK prices.
- Pollution Prevention.
Committing to reducing activities likely to damage the environment is high on the agenda of many countries. Many old mills in China, built before concern about emissions really took hold, create an unacceptably high level of pollution and the closure of these mills has further reduced capacity. Others while stepping up there environmental policies have suffered capacity losses.
The whole effect has been magnified in the UK as GBP weakens against key world currencies in the wake of Brexit.
Price increases can come in various formats Alloy Surcharges, mill increases, rebate reductions whichever format they are presented in, all will push stainless steel prices higher into 2017. We continue, regardless of the ever-changing and never-stable climate created within the industry, to be your partner for stainless steel. This isn't just a slogan: we have worked carefully to provide products and materials of consistently professional quality, all over the world, allowing us to build lasting working relationships with our clients.