Indonesian Stainless Steel Mill Raises Prices Again

Analysts see commodity markets positively strengthened by interest rate cut

Analysts at Wells Fargo recently predicted that not only the current interest rate cuts by the Federal Reserve, but also those to come, could further strengthen the commodity markets by boosting global demand. Historically, commodities have performed well after the Fed's first rate cuts, especially in non-recessionary times.

Lower borrowing costs stimulate demand

The analysts assume that lower borrowing costs will stimulate demand and contribute to the ongoing bull market for commodities. They point out that the absence of a US recession strengthens the case for an increase in commodity demand, with prices typically rising in the following 12 to 18 months after interest rate cuts.

Support for key commodity sectors

Wells Fargo expects improved global liquidity and more favourable credit conditions to support rising prices in key commodity sectors such as metals, energy and agriculture. The bank is therefore maintaining its positive outlook on the Bloomberg Commodity Index.

Indonesian stainless steel mill raises prices again

A large Indonesian stainless steel mill has already raised its prices twice within a few weeks. The background to this is the scarce availability of nickel pig iron, the US interest rate cuts and the fiscal policy package announced by the Chinese government, which have led to a rise in raw material and steel prices.

Nickel prices remain at a high level

Nickel prices on the LME commodities exchange have risen by more than 9.6% since the beginning of September 2024 and have broken through the USD 18,000/MT mark several times in the past week. Nickel prices remained favourable on Monday and were back at USD 17.990/MT shortly after the start of trading.