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Finland-based Outokumpu announced on its website on Thursday February 21 that alloy surcharges for grade-304 cold-rolled (CR) sheets for March will increase by €123 ($139) per tonne to €1,351 ($1,532) per tonne.
Alloy surcharge changes are not necessarily applied to transaction prices in full at the start of each month, and sources commented that such a large increase was likely to be implemented over the course of several weeks.
The flip-side of this was that several distributors said that mills had already attempted to raise their prices this week, before the beginning of March and before most mills have even published their March surcharges.
Two distributors reported seeing offers for grade-304 CR sheets delivered in Northern Europe at €2,200 per tonne, but it was understood that no bookings were made. Trading was instead taking place at the same levels as in the previous week, at €2,050-2,100 per tonne delivered.
The reason for the rise in the surcharge was increases in the nickel price between January 20 and February 20, the period on which calculations for March surcharges will be based.
During this period, the three-month nickel bid/offer spread on the London Metal Exchange went up by 9% to $12,775/12,790 per tonne.
The grade-304 CR sheet market is currently fairly well balanced, according to participants. Although imports from Asia continue to arrive, demand is healthy and distributors felt that passing on the expected higher mill prices to their own customers should not meet too much resistance.
Outokumpu’s March surcharge for grade-316 CR sheets will increase by €148 per tonne to €2,051 per tonne, while for grade-304 bright bars the surcharge will go up by €160 per tonne to €1,620 per tonne.