More breathing room for mills
Global manufacturing activity remained depressed during the third quarter. Europe in particular is facing a significant slowdown, with Germany leading the pack in a negative sense. Inflation is remaining an issue, though improving. And so are central banks’ interest rates that have consistently been raised to battle inflation but are now appearing to have reached a peak. This is being felt, of course, in real demand for stainless steel.
On the positive side, the end of the second quarter marked the conclusion of a destocking period which had lasted an unusually long time owing to the sheer volume of stainless steel flat and long products imported into Europe from third countries last year. With imports and import penetration back to normal levels, mills have been enjoying some breathing room for their own production in Europe.
Scrap demand strengthened during the third quarter, although availability remained constrained owing largely to slow manufacturing activity.
Global stainless production is likely to see another year-on-year increase in 2023. Analysts are predicting growth of some 3% or even 4% for the year. Once again, the expansion is to come from China.