May 2021 Nickel & Surcharge Update
May 2021 Update
Thanks for reading the Ram Alloys Monthly Nickel and 316L s/c update, intended to help our valued customers make educated business decisions.
Recall the service center cost model: base price + surcharge (s/c). Base prices typically remain fixed (until they are adjusted by the mill), and surcharges fluctuate monthly with commodity prices.
MAJOR MARKET IMPACTS!!!
- North American Stainless, the low cost producer, issues base price increase (announcement here).
- All major stainless mills subsequently issued similar increase.
- This is the SECOND mill base price increase of 2021.
- ATI Update: Steelworkers reject company ultimatum, continue strike.
- The longer the strike, the longer the price and demand impact.
More industry news below. Stay tuned and buckle up for a wild summer...
OFFICE CLOSED ON 05/31 TO OBSERVE MEMORIAL DAY
PLEASE REMEMBER OUR FALLEN HEROS
Current Take
April was the exact opposite of March: A weaker US Dollar, along with surprising REJECTION of Chinese EV battery pivot caused Nickel to spike.
Not to mention, ferrochrome prices, the common ingredient in all stainless steels, are surging, further complicating pricing.
Positive spin: there's a quiet confidence of healthy stainless steel demand, which can only translate to increased industrial production.
Yearly/Monthly 316L s/c and Ni Charts
30 day USD Index (down) v. 30 day Nickel Prices (up)
Industry News
Click the links to read each article:
- Trafigura Bets on Green-Nickel Squeeze in Defiance of China
- Elon Musk rejects China's environmentally harmful new battery production.
- Production of chrome ore, which goes into making ferrochrome, was impacted due to Covid-induced lockdown, thereby pushing up prices. These two articles claim a strong recovery will yield increased demand, and therefore increased prices:
- South African ferrochrome industry running out of time
- South African ferrochrome smelters struggle with electricity access and costs. They are considering all forms of energy, but believe time is running out.
- Oil holds near $67 as demand hopes balance India concern
- "Despite the demand downside in India, it's very likely that oil will claw back towards $70 per barrel in the coming months as the global demand uptick tips the scale to positive."
Ram Alloys is a niche service center supplying a complete inventory of stainless steel, nickel products, pump shaft quality bars, and boat shaft quality bars in a full range of standard grades. Value-added services include comprehensive and customized processing options, prompt shipping, same-day order turnaround, and 24/7 availability. We're here to ensure that your procurement needs are met quickly and accurately, minimizing schedule impacts and return material authorizations. Request a quote today!
