Stainless steel prices have been on the rise globally, but not as aggressively as other steel products. Nevertheless, stainless steel prices are currently at their highest level in four years and are expected to continue increasing due to tightening trade policies. 

In China, Wuxi Metal quoted stainless steel at $2,457.49 per ton on June 2, 2021, a 20% increase compared to the beginning of the year and a 39% increase from a year ago.

On the Shanghai Futures Exchange, stainless steel futures for delivery in one month were at 15,535 CNY per ton on June 4, 2021, up 16% from the beginning of the year and 20% from a year ago. 

The scarcity of stainless steel is happening worldwide as production capacity lags behind the growing demand, driven by the post-Covid-19 economic recovery and difficulties in transportation, especially for heavy goods like steel.

The trend of rising stainless steel prices is expected to continue due to recent developments in trade policies affecting stainless steel products, which is causing disadvantages for consumers.

China's stainless steel producers lost the 13% export tax rebate for stainless steel products from May 1, 2021, leading to a shift in focus from export to domestic supply.

The impact of this measure will push global stainless steel prices even higher, reducing the competitive pressure on stainless steel producers in markets that were previously in fierce competition with Chinese stainless steel.

The situation in China does not directly affect the European market, where Chinese raw materials have been expensive due to high anti-dumping duties, reducing the presence of Chinese stainless steel in Europe.

However, this could change in the short term, as steel prices in Europe have been steadily increasing, making imported steel, even with anti-dumping duties, still competitive with domestic steel. Nevertheless, European consumers may have fewer options for imported steel.

Globally, stainless steel production is forecasted to increase by over 8% in 2021 after a decrease in 2020. Strong activity in China is the main driving force behind this predicted growth, with Chinese steel mills increasing production to meet the high domestic demand resulting from government economic stimulus and high global prices.

In the United States, stainless steel production is expected to grow by 16% compared to last year, but still lower than the levels recorded in 2019. Allegheny Technologies Incorporated plans to withdraw from the stainless steel market this year, and there may be strikes by workers at some of their facilities in the near future.

In the European Union, stainless steel production is forecasted to grow by over 10%. The confidence of consumers in the region is rising, thanks to fast deployment of vaccination programs and the lifting of lockdown measures, allowing stainless steel consumption to recover.

The forecast for stainless steel production in Taiwan has been reduced to 890,000 tons due to a major industrial fire at Yieh Corp.'s Kaohsiung plant, which is expected to significantly reduce exports in the second quarter of 2021.

Japan, South Korea, and India are expected to have double-digit growth in stainless steel production to compensate for Taiwan's decrease.

Indonesia's stainless steel production is forecasted to increase by 7.6% compared to last year, reaching over 3 million tons. The production at local manufacturer Tsingshan remains high despite temporary anti-dumping duties applied to exports to the European Union.

At the International Stainless Steel Forum (ISSF) annual conference, experts predict that Indonesia will surpass Japan and India to become the world's second-largest stainless steel producer, mainly due to Chinese companies setting up large-scale production facilities in Indonesia. They forecast that Indonesia's stainless steel production will reach 4.2 million tons this year, a 75% increase compared to the previous year and higher than MEPS' earlier predictions.

In contrast, India's stainless steel production is expected to decrease to 3.5 million tons in 2021 from 3.9 million tons in 2019, but still represents significant growth compared to the previous three years.