Global AL6XN Prices Surge Amid Raw Steel Production Decline, March 2024

March 2024 witnessed a decline in raw steel production, resulting in reduced AL6XN output and a subsequent price hike due to its scarcity in the US market. However, AL6XN demand in the US automotive sector increased alongside growth in manufacturing and exports. In Germany, AL6XN prices rose due to reduced stock levels and improved sector performance, driven by rising nickel prices and heightened downstream industrial activity. China faced challenges with nickel shortages affecting Al6XN production, despite a surge in new energy vehicle sales and profit increases in industrial firms.

In March, the decrease in raw steel production caused a drop in AL6XN output in, leading suppliers to hike AL6XN prices by 2.5%  on a month-on-month basis due to its scarcity in the US market. The American Iron and Steel Institute noted a two-week consecutive drop in domestic raw steel production. Supply and demand imbalances caused price fluctuations, although AL6XN availability met national needs. AL6XN demand in the US automotive market slightly rose as the light vehicle sector expanded, alongside growth in the US manufacturing industry and New Export Orders. Positive industry outlooks and competitive dynamics drove increased AL6XN demand in the American market, with FRED data showing a rise of 0.18% in February month on month for Producer Price Index for Automobile, Light Truck, and Utility Vehicle Manufacturing and Transportation Equipment: Motor Vehicles. Automotive sales volume increased by 16.4% month-on-month, emphasizing strong AL6XN demand domestically.

The prices of Al6XN increases by 1.0% month on month in German market in the meantime. Market dynamics changed due to reduced stock levels and improved performance in related sectors, causing minor shortages for buyers. The Al6XN supply chain faced challenges due to a sudden spike in nickel prices in February. EU steel production declined after prolonged expectations, mainly due to aging blast furnaces needing upgrades. This decline led manufacturers to seek market protection, citing concerns about China's influence. Germany saw a rise in downstream industry activity, driving increased demand for Al6XN, especially from construction projects. These shifts were fueled by rising nickel prices and growing demand in the downstream sector. The industry's overall slowdown was partly offset by stability in civil engineering projects. Panelists noted ongoing challenges from uncertain demand, pricing pressures, and economic volatility. Germany's automotive sector notably surged by 21.37% in new car sales in March, reported by the Federal Motor Transport Authority (Kraftfahrt-Bundesamt – KBA).

This month prices of Al6XN increased by 0.8% month on month in China. China’s Al6XN supply chain heavily depends on raw materials, especially nickel. Delivery time for suppliers dropped by 3.9% in February 2024, leading to a shortage of nickel ore and impacting Al6XN production. Despite challenges, Al6XN managed price fluctuations and market issues. Raw material inventories in manufacturing also dropped, indicating a 47.4% decrease in February. New energy vehicle sales surged in March 2024, boosting total passenger car retail volume. Industrial firms in China saw a 10.2% profit increase in the first two months of 2024, with automotive sales rising by 70% in March.

ChemAnalyst predicts that, the automotive sector's rising demand will cause price fluctuations in the US market. Germany's AL6XN consumption is expected to increase due to heightened demand from the recovering construction industry. Additionally, the anticipated rise in production costs in the Chinese market may lead to price hikes.