According to London-based research company CRU, stainless-steel production will fall for a third year in 2009 as steel mills use up stockpiles and demand weakens. Production will fall less than 1% after last year’s 7% plunge, the biggest drop in at least 20 years, Vanessa Davidson, managing consultant for the nickel and chrome group at CRU, said in an interview by phone on 12 January. Prices of nickel, used to make stainless steel, have dropped 65% in the past two years as stainless steel output declined from a peak in 2006. Macquarie Group Ltd’s forecast for 2009 stainless-steel production has been cut by 24% from an estimate made a year ago, the most of six commodities including copper, aluminum and carbon steel. Its nickel production estimate is down 19%. Output of stainless steel dropped to 26.6 million metric tons last year, with producers from China, the largest supplier, to Japan, the US and Taiwan cutting back, CRU’s Ms Davidson said. ThyssenKrupp AG said in November it would cut stainless steel output by 25% in the first half of this year as weakening demand from carmakers and builders hits sales. Finland-based Outokumpu Oyj last month cut its fourth-quarter profit target in December. Stainless-steel production worldwide fell 0.3% in 2007 after climbing almost 15% in 2006, according to CRU. Stainless steel makes up about 65% of demand for nickel.