Global stainless steel trade linked to quotas

The imposition by the United States government of quotas and tariffs based on national security concerns has reduced the flow of imported stainless steel into the country. As alloy surcharges rose, U.S. mills also raised their baseline for 304 cold rolled coil by $ 200 per tonne, or 16 percent, between January and July 2018. However, buyers felt this trend had gone too far. As alloy charges eased, the baseline has also been cut over the past two months, resulting in a $ 265 /tonne reduction, or 8.5%, in prices.

In contrast, European mills were unable to supplement the increase in alloy premiums with underlying price increases. In recent months, many market participants have resorted to bargaining using "efficient prices" as the difference between the alloy premium and the total transaction value has ceased to represent a viable price.

Temporary quotas for the EU were intended to prevent materials previously destined for the United States from being diverted to the European market. While the stainless steel coil quota almost certainly prevented a third country material surplus, buyers believe they will be able to meet all of their requirements between February and February 2019 within the permitted import tonnage.

However, stainless steel fittings distributors estimate that the quota for this product will be exhausted by December 2018. This shows an upward trend in the search for fittings from abroad - especially from India. Many buyers will now wait until more permanent measures are introduced before placing further import orders.