The upcoming release of EU mills’ stainless steel alloy surcharges for September 2024 is eagerly awaited. Despite the outdated nature of the dinosaur alloy surcharge in stainless steel pricing, it continues to capture attention. This trend persists even as Electric Arc Furnaces (EAF) in EU mills have increasingly relied on stainless steel scrap, now constituting over 90% of their materials.

Nickel price resilience amid volatility
Although the nickel price has dipped compared to August 2024's alloy surcharges, the average LME price for August stands approximately 1.7% higher than July. This is noteworthy given the market turbulence caused by sanctioned, largely unsaleable Russian nickel (representing around 23.5% of LME country of origin stock as of July 31, 2024).

Sustained scarcity of stainless steel scrap in Europe
When considering the quarterly and half-yearly reports released by EU stainless steel manufacturers in 2024, a major ongoing challenge is the severe shortage of stainless steel scrap and the resulting price hikes. This scarcity has persisted since at least the first quarter of 2024 and has garnered attention from European recycling associations.

Scarce supply, surging demand, and depleting inventories
Recent publications suggest that Europe anticipates continued scarcity of crucial raw material - scrap - throughout the third quarter, maintaining high prices. Forecasts also indicate a surge in demand, which prompted notable delivery increases for some manufacturers in the second quarter, alongside reports of depleted inventories at EU distributors.

In contrast to prevailing expectations, current analysis points towards a lack of potential price reductions in Europe. Instead, the projection is for stainless steel prices to hold steady in Europe over September.