February 27, 2025 Palle Thomassen, Jan Knaak
Market Trends for Stainless Steel
Welcome to the latest market insights from Damstahl, where we delve into the dynamic world of stainless-steel trends. You’ll get a closer look at current market developments and updates on price trends, energy and transportation situations, as well as the availability of different product groups.
Market Trends
The year 2025 started off much better than anticipated, with reasonable demand and projects returning to the table. The situation is still challenging, but at least the market is showing some developments. At the same time, we’re seeing many different ideas coming out of the U.S., where, since January 20th, Donald Trump has returned to the Oval Office. As of now, it looks like protectionism could be worse compared to his first term in office.
The German election has also taken place, and the new government can now be formed. This will be very challenging in itself and will probably not lead to major changes in the economy, where another year of recession is projected for Germany. Prices are expected to rise, with flat products increasing in price, and the downstream products, such as tubes and potentially fittings, will be affected as well, due to unsustainable earnings at the mill site.
Raw materials
Nickel (LME 3 month)
Since we last reported on nickel (in November), there haven’t been major changes in this raw material. It has remained between $15,000 and $16,000 per ton.
New rumors suggest that Indonesia wants to increase costs for mining companies, while at the same time, one of the larger smelters may be going bankrupt and ceasing operations. The current price doesn’t reflect these rumors, but forecasts predict a slight increase for March/April and a larger increase for the summer. However, the reliability of these forecasts must be questioned, as the market is still weak, and demand isn’t driving prices up. We’re still facing a strong oversupply of nickel.
Chromium
Still there is no new pricing-mechanism in place, only spot-prices are available for the mills and traders. Therefore, it’s very hard for us to give any idea about the price-development or if the current price-level is reasonable. All in all, prices for different types of Chromium remain rather stable, with very slight increases over the last three weeks.
Ferromolybdenum
Ferromolybdenum holds its strong position going into 2025 – we still see values of around
51.000 $/to. making it the champion in raw materials after a good performance in 2024 already. Explanation could be found in the demand from China remaining high due to higher grades being produced, but also a good demand coming from the pharmaceutical industry.
Aluminum and Copper
We expect Trump’s policy agenda to pose the greatest risk to lower-than-expected demand for both aluminum and copper in 2025.
Not only will the new tariffs on aluminum and steel products impact prices, but Trump’s desire for further involvement in national conflicts in both Ukraine and Palestine could also drive price fluctuations in both upward and downward directions.
At present, both aluminum and copper are trading at higher price levels than at the beginning of the year. However, this may change depending on actions taken by Trump, Russia, Israel, and Europe in the coming months.
Aluminum
The price of aluminum remains high due to supply disruptions, despite weak economic growth in China and a strong USD. Significant price increases for bauxite and alumina have put pressure on aluminum producers. The European market remains weak, particularly in Germany—Europe’s largest aluminum consumer—which continues to show major signs of economic slowdown. Despite the current decline in mill activity, we still anticipate a slight increase in aluminum prices in the near term.
Copper
The price of copper is still affected by the continued increase in demand. The increasing need for copper continues to overshadow the global political disagreements and we continue to experience rising prices.
Trump's desire to increase the production of fossil fuels and thereby deprioritize the green energy sources does not affect either the demand or the price development.
Energy costs
In January, we were approached by several mills regarding increasing energy costs. There were periods in Europe when there was neither sun nor wind, which resulted in shortages and higher imports of energy, especially into Germany. At the same time, there are reports of gas storage levels being reduced, which has also resulted in higher prices.
All in all, it’s clear that natural gas has become much more expensive over the last few weeks, reaching a level of nearly €55/MWh. However, prices are now decreasing and are expected to further decline as the warmer season approaches.
Freight situation
Sea
When reading the news in the shipping industry, a hot topic is whether or when the reopening of the Suez Canal could become a reality. This would lead to shorter transit times and lower fuel costs but could also result in congestion at the main ports in Europe, as ocean vessels passing through the Suez will catch up with those that have gone around the south of Africa.
However, the situation in the Middle East is not stable enough to proceed with this, and secondly, the industry has no intention of optimizing this part of their operations right now, as general demand is still very low.
Based on this, the SCFI rates confirm the situation, as freight levels continue to fall.
Road
From 2025, the EU Emissions Trading System (ETS) requires shipping companies to cover 70% of their emissions with allowances. This is to speed up the use of sustainable fuels.
Diesel fuel costs have increased between 5-6 % for transportations in only 2 months, which have a huge impact on the total distribution cost. Some of the increase is due to the implementation of the Danish Road Tax.
We will be monitoring this closely together with the extra cost related to ETS.
Scrap
Due to weak stainless-steel demand, there is a low generation of new stainless scrap and an inhibited scrap flow, which should lead to rising prices. The price of scrap is rising slightly at the moment, but with a relatively small impact on the alloy surcharges.
Reduced use of stainless scrap due to substitution with NPI, combined with increasing imports of low-cost slabs and billets from Indonesia, could, however, be a trend that pulls in the opposite direction.
From an overall perspective, we still believe that prices for stainless scrap will rise moderately in 2025, as scrap plays an important role in the green transition of the stainless steel industry.
News on products
Tubes (Seamless)
Within seamless tubes the supply-situation does also remain stable. We see rather short delivery-times coming from European produces, while the delivery-time out of India remains stable with 6 – 8 months. All in all, there are no major concerns in this product-area.
Pricewise base-prices and eff.-prices should remain rather stable for the coming months since also here signals for lift-ups are very rare.
Tubes (Welded)
With Marcegaglia as the frontrunner, the Italian tube mills has announced a new European price list effective no later than 1st March. Raw material and energy costs are amongst the cost drivers and thereby prices will increase.
Demand in Central Europe is relatively stable, but at a low level, whereas demand in the Nordic countries seems to be more healthy.
Mill stocks are sufficient to cover, to a large extent, the daily demand whereas project orders can be supplied with 8-12 weeks depending on grade and size.
Bars
Prices and delivery-times for both European and Indian bars remain stable these days – we can see no major changes in base-prices or Alloy Surcharges.
The demand for the producing mills remains low and the global competition is very tough. Especially with new duties for the U.S.-market it’ll be interesting to see if material-flow re-routes from Asia to Europe or if there will be any countermeasures coming from the EU.
We’ve just recently been informed about an investigation on the Safeguard-mechanism, where Eurofer is asking for major changes in the model i.e. higher duties and less quota being available.
Sheets
The European mills are operating at break-even level or below, and financial results from Q4 2024 show significant losses, making this an unsustainable situation. Consequently, as expected, the mills have announced rising prices in February, with a further increase expected in March.
Market sentiment seems to be slightly more positive in the Nordics, coming from a low level. This could partly be related to restocking by service centers and stockists after the seasonal destocking in Q4. Capacity reductions from the mills are expected, if needed, to balance the supply and demand situation and keep prices at a sustainable level.
Price-development and conclusion
As we have mentioned in the sheets and tubes (welded) section, there are movements in the prices – at least the mills are aiming for some increases at the current price levels, which, from a European perspective, definitely makes sense. The situation is in contrast to what we are seeing in bars, where prices remain stable and demand remains weak.
The upcoming weeks will reveal many key indicators for the economic year 2025:
- What will happen in Ukraine now that Trump is pushing for an agreement there?
- What impact could a new German government, possibly by Easter, have on the economy?
- Will price increases from flat- and tube producers withstand low demand?
At Damstahl, we’re experiencing a positive activity level, which is also confirmed by the market feedback we receive from our customers, showing an increasing tendency from January to February.
Want to know more?
Palle Thomassen
Purchasing Director, Nordic
path@damstahl.com
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