Page 75 from: Recycling International November/December issue 2024

NICKEL & STAINLESS

million tonnes. Along with increased
stainless production in the United
States (+9%), Europe (+0.3%) and
‘Others’ (+10.5%), worldstainless esti-
mates global melt shop production
increased 6.3% to nearly 30.4 million
tonnes during the first six months of
the year with China accounting for
62% of global output.
Corporate reports from the major
stainless steel producers in the West
indicate mixed market conditions in
the third quarter of 2024. According
to preliminary Q3 2024 results from
Finland-based Outokumpu Oyj, trans-
action prices for 304 stainless in
Europe and the Americas came under
pressure in the third quarter as scrap
prices softened. However, the compa-
ny’s third quarter stainless deliveries
in Europe were steady at 316 000
tonnes and ebitda improved to EUR
86 million for the quarter. While
Outokumpu’s stainless deliveries in
the Americas business unit slipped in
the third quarter, the overall recycled
material content in their stainless pro-
duction remained elevated at 95%.

US-EU EXPORTS UP
Of note, as European stainless steel
deliveries have stabilised, US exports
of stainless steel scrap to Europe
have been surging. According to US
Commerce Department data, US
exports of stainless steel scrap to
Finland, the Netherlands and Belgium
combined more than tripled year-on-
year to nearly 54 000 tonnes during
Jan-Sep 2024.

Outokumpu’s forward guidance indi-
cates ‘Group stainless steel deliveries
in the fourth quarter are expected to
decrease by 0–10% compared to the
third quarter, driven by deteriorating
markets for both business areas in
Europe and the Americas’. That guid-
ance coincides with generally nega-
tive manufacturing indicators overall.
According to the Institute for Supply
Management, US manufacturing
declined by 0.7 points to 46.5 in
October, the lowest reading in 2024
and marking a contraction in the US
manufacturing sector in 23 of the last

24 months. The shifting political
winds and potential for rising tariffs
and other trade restrictions are also
clouding the short-term outlook.

LONG-TERM OPPORTUNITIES
As for the longer-term outlook, market
participants continue to point to the
advantages of stainless steel scrap over
other raw material inputs, especially as
environmental and sustainability con-
cerns become prominent. Speaking at
the Bureau of International Recycling’s
Convention in Singapore, BIR Stainless
Steel & Special Alloys Committee chair-
man Joost van Kleef from Oryx
Stainless stressed that ‘green steel’
production relies on scrap, noting that
once the EU’s Carbon Border

75recyclinginternational.com | November/December | 2024

Adjustment Mechanism comes into
force in 2026, ‘green stainless steel will
be the only participant in the EU stain-
less steel market’.

Stainless steel scrap prices and nickel
scrap discounts are widely expected
to be impacted by the relative prices
of primary nickel, nickel pig iron, and
other substitutes, along with potential
barriers to trade and other regulatory
changes. With supply surpluses pro-
jected for the foreseeable future, the
consensus forecasts of analysts polled
by Reuters in October show average
LME cash nickel prices of US$ 17 130
per tonne this year and US$ 17 288
in 2025, down from US$ 21 495 in
2023.

Volatility persists as surplus dampens price recovery
After a brief rally above US$ 18 000 per tonne in early
October, nickel prices dropped quickly back to around
US$ 16 000 per tonne by the month-end. Despite challenges including
lower ore grades and limited mining activity in Indonesia, the country’s
nickel supply grew by more than 140 000 tonnes (15%) year-on-year from
January to August 2024, compared to the same period in 2023. Even
though production of stainless steel and nickel-alloys is expected to rise by
5% and 6% respectively this year, the nickel market is facing a likely surplus
of about 170 000 tonnes. Additionally, China’s shift to lithium-iron-phos-
phate batteries is limiting nickel demand in the battery sector, while high
EV prices and policy challenges are slowing EV sales in Europe and the
USA. Combined with LME warehouse stocks hitting a three-year high of
150 000 tonnes, these factors are likely to cap any sustained price recovery.

Reference date: November 15, 2024

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