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* Gueugnon plant fire to tighten market in Europe
* Finnish producer Outokumpu likely to benefit the most
NEW YORK, Jan 8 A fire affecting output at a
French Aperam stainless steel plant will benefit
Outokumpu and other European producers and will put
upward pressure on European prices in the next few months,
market players said this week.
Europe's third largest stainless steel maker, Aperam, said
last week that a fire at its Gueugnon plant, in eastern France,
damaged a main processing line and will affect production until
at least the second quarter.
The Gueugnon plant is a major European supplier of stainless
steel flat products, used in everything from automotive to home
appliances. It produces about 350,000 tonnes a year of finished
stainless steel products.
"As a consequence of the Aperam fire we expect to see short
supply of cold-rolled products in the market in the next few
months," a southern European stockholder said.
"We will likely see more imports and some price increases in
February and March. Outokumpu will probably be the biggest
beneficiary and Acerinox and other European producers
might benefit too."
Aperam said it was looking for alternative sources of
semi-finished products so that it can continue to produce
finished products at the Gueugnon plant.
Some of this supply will likely come from European
competitors such as Inoxum, a unit from Germany's ThyssenKrupp
, which Finnish producer Outokumpu acquired last year,
market sources said.
Supply tightness and some seasonal restocking should support
stainless steel prices in the next few month after prolonged
weakness seen in the second half last year.
(Reporting by Silvia Antonioli; Editing by Bob Burgdorfer)