Although the price of nickel has trended sharply higher over the past two years, there still does not appear to be a wholesale shift by manufacturers away from the increasingly expensive high-nickel grades of stainless steel.

Instead, industry participants see trends in every direction, from substitution to project delays to normal use to even increased use of nickel-bearing grades of stainless steel.

One Southern service center manager said he's seeing greater risk-taking on downgrading to stainless steels that contain less nickel as a way to save money. But the savings come short-term, he said. "The mills have indicated there is more interest in lower nickel-containing grades like 201 and 301 and 430," he said. "And in some cases I'm hearing people are moving to carbon and coated steels at the expense of lifecycle. They're saying, 'If it lasts 10 years that's great. I won't be here in 10 years anyway.'"

Users are attracted by the lower price of lower-nickel grades of stainless. For example, including March surcharges, the price of standard-gauge cold-rolled sheet in Type 304 costs about $2.28 a pound, while Type 201 costs just $1.62 a pound.

The service center manager said, however, that while Type 201 has a price advantage, it doesn't fabricate as easily as Type 304. "Type 201 has more manganese than nickel, so that creates some surface issues, like tiny seams forming. Plus, it's stiffer to work with," he said. "But for the most part they're just buying the look of stainless steel. I see a big move in...