According to SMM data, during the week of March 9–13, 2026 , China’s stainless steel market moved into the middle phase of the traditional peak-demand season known as “Golden March,” while trading in the most-active stainless steel futures contract rolled smoothly into SS2605 . Against a backdrop of escalating geopolitical tensions and a visible turn in inventory trends, stainless steel futures continued to trade at relatively elevated levels. As of 10:15 a.m. on March 13 , the contract stood at RMB 14,275/mt (about USD 2,068/mt) , up RMB 40/mt (about USD 5.80/mt) from the previous Friday’s close. This week’s key market tension remained the mismatch between rising supply and only a modest recovery in demand. Although fundamentals have yet to show strong upward momentum, geopolitical risk premiums and persistently high raw material costs have kept downside pressure limited, preventing a broader correction from taking shape. Macro backdrop: geopolitics abroad, policy support in China At the macro level, external black swan risks and policy support in China have created a clear contrast. Iran reiterated that it would maintain the effective closure of the Strait of Hormuz, reinforcing safe-haven demand and pushing the US dollar index higher. That, in turn, capped upside in dollar-denominated base metals. Meanwhile, US core CPI rose 2.5% year on year in February , in line with expectations, easing immediate inflation concerns. Even so, the market remains wary of a potential surge in energy prices in March. In China, the Ministry of Finance has signaled that fiscal policy in 2026 will remain more proactive, with RMB 100 billion (about USD 14.49 billion) allocated to strengthen coordination between fiscal and financial policy, particularly in support of household consumption and private-sector investment. That measured policy support has helped improve expectations for a broader recovery in commodity demand. Inventory draw emerges, but spot demand remains cautious On the fundamentals side, the stainless market has finally reached a meaningful inflection point in destocking, although spot trading still appears underwhelming. The latest SMM data shows that social inventories fell to 998,100 mt this week from 1,016,400 mt the previous week, a decline of 18,300 mt , taking inventories back below the psychologically important 1 million mt threshold. As downstream processing plants gradually resumed operations, demand continued to recover. However, while spot transactions improved from earlier levels, trading activity still fell short of the strength typically associated with the seasonal peak. End-users have largely remained focused on buying only what they need, with little appetite for active restocking. At present, the supply increase resulting from concentrated mill restarts in March is meeting only a slow improvement in end-use demand. That still-fragile recovery continues to limit market confidence in any stronger upside breakout during the peak season. Raw material costs remain the key floor Raw material costs continued to trend higher and remain the market’s main source of downside support. With geopolitical tensions lingering and tight ore supply from Indonesia continuing to feed through the market, upstream quotations kept rising. As of March 13 , high-grade NPI moved up further to RMB 1,094.5 per nickel unit (about USD 158.61 per nickel unit) , up RMB 6.5 (about USD 0.94) from a week earlier. High-carbon ferrochrome also climbed to RMB 8,650 per 50-basis mt (about USD 1,253.50 per 50-basis mt) . As raw material prices continue to move higher, stainless mills’ production cost floors are also rising. Although downstream buyers remain resistant to expensive material, room for mills to offer discounts has narrowed sharply under the pressure of high costs and, in some cases, negative margins. As a result, cost support for both futures and spot prices has become increasingly firm. Outlook: high-level consolidation likely to continue Overall, the stainless steel market is now caught in a complex tug-of-war defined by rising supply, only a weak recovery in demand, firm cost support, and a clear turn in inventories. The safe-haven and inflation-hedging logic stemming from the Strait of Hormuz crisis, together with NPI prices approaching the 1,100 threshold, has effectively limited downside in the futures market. At the same time, subdued spot order activity has capped upside momentum. Looking ahead to next week, the market will be watching closely to see whether the destocking trend can continue. The main focus will shift to actual arrivals following mill restarts and the pace at which downstream orders improve. In the near term, the most-active stainless steel futures contract is expected to remain rangebound at relatively high levels. Market participants are advised to closely monitor geopolitical developments and nickel ore price movements, as both could trigger sudden directional swings. Written by: Bruce Chew | bruce.chew@smm.cn +601167087088

[Domestic Iron Ore Brief: Iron Ore Concentrate Prices in West Liaoning May Have Some Upside Potential] According to SMM tracking, iron ore concentrate prices in west Liaoning experienced a slight decrease. The current ex-factory price for 66% grade iron ore concentrates on a wet basis, excluding tax, is 750-755 yuan/mt. Some small and medium-sized local mines and processing plants suspended production for maintenance during the Chinese New Year and have not yet resumed normal operations. Most large mines and processing plants maintained normal production, but overall iron ore concentrate output remains relatively low.

Operations at the nickel-cobalt project Ambatovy in Madagascar have been suspended after a powerful cyclone struck the country. The project produced approximately 28,000 tonnes of nickel and 2,500 tonnes of cobalt in 2024. The storm also severely damaged Madagascar’s main port, Toamasina, potentially disrupting exports of mineral products. The company said its local processing plant sustained material damage and is currently assessing the full impact on assets and operations, with production to resume only after site safety and environmental conditions are fully verified. Ambatovy mainly produces nickel and cobalt briquettes, which can be further processed into sulphates used in battery materials. Market participants noted that a prolonged outage could push up battery material prices.

[SMM Aluminum Morning Meeting Minutes: Aluminum Ingot Inventory Buildup Pressure Rises, Aluminum Prices Mainly Under Pressure] In summary, amid the impact of previous macro headwinds, a large amount of capital took profits and exited the market, leading to a pullback in aluminum prices and a decrease in open interest. However, as precious metals did not show further signs of decline, aluminum prices stabilized accordingly. In the short term, aluminum prices are expected to consolidate with volatility.

Shanghai Metals Market (SMM) is delighted to announce that Touchi International Corp has officially joined our 2026 (3rd) Global Renewable Metals Industry Summit to be held in Tokyo, Japan, on May 11-12, 2026, as the Dinner Sponsor.

According to Reuters, the Indian government plans to soon introduce incentive measures to encourage companies to build lithium and nickel processing plants. India aims to raise electric vehicle penetration to 30% for passenger cars and 80% for two-wheelers by 2030, but currently remains highly dependent on China for mineral processing technology. Under the government proposal, India plans to offer capital subsidies of up to 15% for lithium and nickel processing projects launched on or after April 1, 2026. The incentives would be available for five years and subject to caps as well as sales and project scale thresholds. Minimum capacity requirements are set at 30,000 tonnes for lithium processing plants and 50,000 tonnes for nickel plants.