According to UK-based Meps the substantial rises in nickel costs in July have not been incorporated into selling values in any part of the world and are likely to have an impact in North America and the EU in September-October. The Asian mills should be able to move up transaction prices from earlier upward trends in nickel. All this activity leads Meps to lift their forecast for world prices and a substantial rise is predicted for September. Meps is however slightly bearish about the prospects for 2007 as many pundits predict a decline in nickel prices next year. Substantial inventory building is occurring in both markets and will extend up to the end of the year. Meps expect sentiment to change in 2007 and a period of stock depletion is anticipated, particularly if the nickel price continues to slip. As real demand across the world is growing at a significantly slower rate than production, They believe that most markets have recovered from the destocking phase in 2005 and inventory building is currently taking place ahead of impending price rises. Meps thus forecasts world stainless steel transaction values peaking towards the end of this year and falling in mid 2007 to a figure close to current levels.
