After A Pause, Metals Prices Head Higher Again

Many key metals used widely in foodservice equipment and supplies are headed higher again, after strong price increases seen since last fall softened somewhat in late spring and June.

Prices for nickel and copper have both shown gains of more than 10% during the past two months, after sliding in April and May. The nickel trend has begun to push up surcharges for widely used stainless steel grades such as 304. “The surcharge trend line has reversed recent (stainless) declines with August shaping up as (the) near-term low point, driven by the uptick in nickel,” reported Macsteel Service Centers in its monthly “Metals Update” for July, published in Prime Advantage’s Prime Times e-newsletter last week.

After softening slightly in May and June, aluminum prices have also begun to head higher, Macsteel said. And the trend is clearly for stronger prices for the metal in coming months, the supplier noted.

The carbon steels are the major exception to the trend. Prices for most carbons, including cold-rolled, hot-rolled and galvanized, saw strong increases early in the year but have softened consistently since April. Macsteel said demand for these steels, widely used in autos and other markets as well as foodservice equipment, is weak and inventories high. Still, even with carbons, Macsteel said “We expect the market to bottom out due to increased raw material cost pressure in mid- to late third quarter.”

So the trend is clearly for higher materials costs for most E&S manufacturers in the coming months, putting even more pressure on E&S prices.