At the UK Metals Expo 2024, the panel discussion “Stainless Steel Market: Exploring Trends and Price Dynamics” brought together industry leaders to analyse the future of this essential material. Speakers included Lauro Castelo, Trader at Trasteel International SA; Terry Sargeant, CEO of SteelBuy; Alison Taylor from Marcegaglia; and Kaye Ayub, Senior Consultant at MEPS International Ltd. The debate covered crucial topics shaping the stainless steel market, including technological advancements, pricing models, and sustainability practices.
Kaye Ayub posed a critical question to the panel: Is it time for a more widely adopted shift to an effective pricing system in the stainless steel market? This sparked an engaging debate about current pricing models, particularly around the alloy surcharge system.
Simon Marsden, Head of Sales at Outokumpu UK, noted that the base plus Alloy Adjustment Factor (AAF) system remains the industry standard for contracts, even as the use of more effective pricing models has grown. Marsden acknowledged the challenges posed when alloy prices fall, while effective prices rise, but emphasised that the AAF system still has a place in the market, especially for long-term contracts.
On the other hand, Lauro Castelo of Trasteel International highlighted the controversy surrounding the alloy surcharge, particularly during periods of price volatility. He cited May 2022, when the surcharge for grade 304 alloy peaked at 4,000 - 4,200 USD per ton, as a difficult time for the market. While Castelo recognised that the surcharge model works for end users, he expressed doubt about its sustainability for distributors, especially as prices have turned negative in recent months.
Rodney Rice, Director at Langley Alloys, which supplies niche stainless steel to the aerospace, oil, and gas sectors, offered a different perspective. He said his company closely monitors raw material prices and the London Metal Exchange (LME) to forecast potential market movements. Rice noted that prices in his sector have stabilised, with the key focus now on availability and lead times rather than significant price shifts.
The panel also explored broader market trends and the growing importance of online trading platforms, with Terry Sargeant from SteelBuy discussing how these platforms are transforming the way stainless steel is traded, increasing both efficiency and accessibility.
For attendees, the session provided valuable insights into the future outlook of the stainless steel market, addressing key issues like pricing dynamics, sustainability initiatives, and supply chain resilience. The debate underscored the challenges and opportunities the industry faces, as it continues to adapt to global economic shifts and technological advancements.
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