This week, stainless steel futures have trended downward. As of Friday afternoon, futures contracts for stainless steel closed at 13,465 yuan per ton. The arrival of the “Golden September and Silver October” has done little to boost demand, with spot prices for stainless steel continuing to decline. In the Wuxi market, the price for 304 cold-rolled stainless steel has dropped to 13,600 yuan per ton, down by 150 yuan from the previous week. Similarly, in the Foshan market, the price for 304 cold-rolled stainless steel has fallen to 13,700 yuan per ton, a decrease of 100 yuan from last week.
On the raw materials front, the end of the rainy season in Indonesia has eased nickel ore supply issues, leading to stable yet weak nickel ore prices. However, nickel pig iron prices have declined this week due to weak downstream demand for stainless steel and high production rates by steel mills. As of September 6th, domestic prices for high-nickel pig iron have been reduced by 5 yuan to 995-1,000 yuan per nickel, with delivered prices also falling by 5 yuan to 1,000-1,005 yuan per nickel. Indonesian high-nickel pig iron FOB prices have remained stable at 121 USD per nickel, while the domestic tax-inclusive price has decreased by 5 yuan to 995-1,005 yuan per nickel. Overall, the raw materials market remains weak and stable, placing continued pressure on stainless steel prices in the short term.
In terms of supply, the market continues to experience weak demand while steel mills maintain high production levels. Data shows that in August 2024, the output of crude stainless steel from 43 domestic mills was 3.3591 million tons, including 1.686 million tons of 300 series, which represents a month-on-month increase of 50,100 tons or 3.06%. September’s production is expected to be 3.3342 million tons, with 1.6886 million tons of 300 series, marking a slight increase of 0.15% from the previous month.
Nationally, the total social inventory of stainless steel across major markets stands at 1,062,037 tons, a decrease of 2.25% week-on-week. Of this, cold-rolled stainless steel inventory is 695,998 tons, down by 1.64%, while hot-rolled stainless steel inventory is 366,039 tons, a reduction of 3.39%. Although there has been a reduction in inventory, high stock levels continue to exert pressure on the market.
In summary, with demand remaining subdued, weak raw material prices, and steel mills maintaining high production rates, stainless steel prices are expected to face ongoing pressure, likely resulting in a weak and stable market in the near term.