Nisshin Steel Skips Order Receipt of Ni Stainless Cold Sheet in Jan.

Nisshin Steel announced on Monday the firm skips order acceptance for nickel series cold rolled stainless steel sheet from distributors in January. The order skip continues for 7 consecutive months. The market inventory adjustment is running. But the firm judged it’s necessary to adjust the inventory additionally. The firm’s Shunan works increased the output reduction rate to over 50% from 40% for December ?January compared with normal operation. The firm aims to improve the supply and demand balance as early as possible.

Nisshin Steel utilizes the fluctuating range of nickel price, ferrochrome price and yen rate in previous month and the month before to decide the selling price of stainless steel sheet. Nickel price was US$ 4.41 per pound from 21 November to 20 December and US$ 4.95 from 21 December to 20 January. Consequently, the firm supposed to reduce the selling price by about 10,000 yen per tonne. But they decided to keep the selling price unchanged and skip order acceptance to reduce inventory.

Ferrochrome makers reduced the selling price to European stainless steel makers. However, the firm didn’t consider the fluctuating range of ferrochrome price when the firm has ferrochrome inventory enough and domestic stainless sheet market price already dropped considerably due to lower nickel and ferrochrome costs.

Nisshin Steel said stainless steel inventory in Asia almost halved from the peak in last spring. Chinese inventory of hot-rolled and cold-rolled stainless sheet is above 75,500 tonnes, the firm estimates. Importers in Hong Kong or Taiwan are purchasing Chinese stainless sheet with an expectation the market price would rise after Chinese New Year holidays. Nisshin Steel expects Japanese market price surges in conjunction with overseas market price.