US stainless steel sheet prices rise on tighter supply

Stainless steel sheet prices in the United States rose in June due to rising surcharges and increasingly tight supply.

Fastmarkets’ monthly price assessment for stainless steel 304 cold-rolled sheet, fob mill US was $171.75 per hundredweight ($3,435 per short ton) on Monday July 12, up 2.08% from $168.25 per cwt on June 10 and up 7.34% from $160 per cwt on May 10.

The assessment for stainless steel 304L cold-rolled sheet, fob mill US was $173.75 per cwt ($3,475 per ton) on Monday, up 2.06% from $170.25 on June 10 and up 7.25% from $162 per cwt on May 10.

Fastmarkets’ assessment for stainless steel 316L cold-rolled sheet, fob mill US rose to $231 per cwt ($4,620 per ton) on July 12, up 6.70% from $216.50 per cwt in June and up 12.41% from $205.50 per cwt in May.

Supply, which was already falling short of demand, tightened further on July 7 when North American Stainless (NAS), the largest US stainless producer, declared force majeure due to the inability to obtain oxygen supply for its Ghent, Kentucky, meltshop and warned of shipment delays. On July 12, NAS withdrew the force majeure declaration.

Market overview
Higher fob mill prices for stainless sheet were mostly due to rising alloy surcharges, while downstream stainless prices increased sharply because of tight supply, according market participants.

A midwestern fabricator said the market was significantly out of balance. “Demand is still quite strong and exceeding supply nearly two to one, while customers are looking to secure metal through year end,” he said. Lead times are out 12 to 16 weeks, “but actual deliveries are averaging three to four weeks later.”

An East Coast distributor said the market was in short supply even before NAS declared force majeure. “There are more shortages than last month. There is also a shortage of recycled scrap.”

“Mills are short shipping us [on our allocations]. Some are delaying it,” he added

A West Coast distributor reported rising price pressure from restricted supply. “It’s really tight out there. Extremely tight.” 

This distributor said he has been buying stainless plate from the mill and lead times are between four to eight weeks.

“The fob mill prices don’t mean much when you’re buying through distribution,” the West Coast distributor said. “If the mills cut back 20-25%, you’re out on the street for the rest” and downstream prices are soaring much higher than fob mill prices.

“We pay $250-275 per cwt for stainless sheet. [In one instance,] I paid over $330 per cwt for 304 stainless through a master distributor,” the West Coast distributor said. 

A midwestern distributor reported similar difficulty. “I have no idea what the price is right now when you cannot even get the product.” This source was unable to confirm a price from other distributors.

A northern distributor also found pricing a challenge. “The fob mill price is useless,” he said. “When I try to pick something up, it’s not available, When it is available it is $1 per lb higher and I’m getting it from a competitor of ours.”

A southern consumer, whose supply mostly comes from a domestic mill under long-term contracts, said that domestic mills have reduced his allocation and he is having to buy more volume from higher-priced imports.

“What we have on order [for imported metal] is coming in at $185-225 per cwt [ddp Port of Houston],” he said. “New buys are significantly more, $245-285 per cwt. Brokers and traders with stock or inbound are $265-385 cwt.”