June 2023 Nickel & Surcharge Update
Monthly Nickel and Surcharge Update
June 2023 Update
Thanks for reading the Ram Alloys Monthly Nickel and 316L s/c update, intended to help our valued customers make educated business decisions.
WHAT IS NORMAL?
- 316L Surcharges remain steady. Is the drop done?
- Nickel & Moly have cooled off for the second straight month
- Base prices rise for the second time in 2023
- Long lead times are still the main driver for 2023 pricing
- Lead times are still well into Q4 2024 depending on the grade.
Current Take
RAW MATERIAL PRICES: Raw material surcharges tanked in April as they continued their downward trend. Moly was the main reason for the large drop.
LEAD TIMES: Long lead times will be the story of 2023 due to high demand, low VAR and finishing capacity, and labor shortages. All grades are into Q2 2024 and beyond. Uncertainty and apprehension to buy may rein them in, but the equal and opposite reaction may be stock outs...not helpful. The balancing act continues.
BASE PRICES: Most mills continue to stay consistent with their base prices, with some incrementally increasing base prices on top of the Q1 bump. We expect this to remain the story going forward. Simply put: mills do not need business.
SECTION 232: Quota is still open for Q2 but how long will this last? We are nearing 50% after the first month, and once quota is filled the 25% tariff will be back. The 25% tariff was in play during Q1. Keep in mind, the quota system is set to expire this year.
Industry News
Click the links to read the articles below:
- Stainless Steel Remains Buyers Market As Demand Growth Flatlines
- LME's nickel crisis: major developments since trading halt crisis
- LME to tighten rules for nickel handling by warehouses - Bloomberg News
- Copper to drift higher, but struggle to rally
- Column: China's refined nickel imports slump to near 20-year lows
- Steelmaker Outokumpu tops Q1 forecasts, sees Q2 at similar level
- US steel market expects further price cuts despite stable demand - S&P
EU Quota Info
EU Quota System Highlights:
- Quotas by EU country, not mill, and by HTS Code, not grade
- Quarterly volumes based on a first come/first served bases
- Link: US Customs and Border Protection Quota Bulletins
- Link: US Customs and Border Protection Quota Utilizations found in its Commodity Status Reports
- Imported volumes > quota assessed a 25% tariff
- Exclusions apply, but adjustments under consideration
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