Last week, Spanish producer Acerinox announced that it intends to increase its prices, citing strong demand and low inventories as the reason for the move. The offers made during the past week, especially from the
Far East and
Europe, also indicated increases. As we mentioned in our previous analyses, the structure of the world
stainless steel prices means that they give a direct reaction to nickel price levels and stock movements. Looking at last week, we see that the cash buyer price for nickel increased from $35,000/mt to $37,200/mt. The revival in the market as a result of the favorable weather conditions, especially in
Europe, has caused purchases to increase and inventory levels to decline. Observing these movements and taking the announcements of last week into account, investors proceeded to conclude nickel purchases. As experience has shown us, metal prices tend to react to every kind of development, somewhat in the manner of a stock exchange. For instance, the zinc prices, which were expected to increase two weeks ago, instead saw a sharp decline before recovering to gain stability. The main reasons for the price movements may be considered to be the speculation by investors, who reap high profits from such price movements, and also the purchases by the mills of metal raw materials in line with their needs. Therefore, it would be wrong to indicate inventories and strong demand for
stainless steel as the only reasons for the price increases. One of the reasons for the rise in the cash buyer price for nickel may be indicated as the financial input as a result of
investments in the metal stock exchange. Therefore, market players in the
stainless steel market would be advised to act with great caution in the current period.