[SMM Stainless Steel Daily Review] SS Futures Strengthen After Chinese New Year Holiday, Spot Prices Follow Upward Trend With Sluggish Trading SMM February 24: SS futures continued to rise sharply. On the first trading day after the Chinese New Year holiday, supported by gains in LME nickel during the holiday, SHFE nickel caught up with gains post-holiday, and SS futures strengthened in tandem, closing at 14,085 yuan/mt. In the spot market, on the first trading day after the holiday, some traders remained on holiday, resulting in relatively sluggish actual trading during the day. Spot quotations followed the upward movement of SS futures, with improved market confidence. The most-traded SS futures contract strengthened and edged higher. At 10:30 a.m., SS2604 was quoted at 14,125 yuan/mt, up 360 yuan/mt from the previous trading day. In Wuxi, the spot premiums/discounts for 304/2B were in the range of 145-345 yuan/mt. In the spot market, the average price for cold-rolled 201/2B coil in Wuxi was reported at 8,500 yuan/mt; for cold-rolled mill-edge 304/2B coil, the average price in Wuxi was 14,200 yuan/mt, while in Foshan it was 14,150 yuan/mt; in Wuxi, the price for cold-rolled 316L/2B coil was 26,600 yuan/mt, and in Foshan it was 26,600 yuan/mt; for hot-rolled 316L/NO.1 coil, the price in Wuxi was reported at 25,750 yuan/mt; in both Wuxi and Foshan, the price for cold-rolled 430/2B coil was 7,800 yuan/mt. During the Chinese New Year holiday, the domestic stainless steel market entered a seasonal lull, with SHFE also closed for the holiday. Spot trading was suspended, and prices showed no significant fluctuations. Overall, before the holiday, the market exhibited a pattern of strengthening futures, stagnant spot trading, weak supply and demand, and significant inventory buildup; after the holiday, the market...

During the Chinese New Year holiday, the domestic stainless steel market entered a seasonal shutdown phase, with the SHFE also suspending trading and spot transactions halting, resulting in no significant price fluctuations. Overall, before the holiday, the market exhibited a pattern of strengthening futures, stagnant spot transactions, weak supply and demand, and significant inventory buildup. After the holiday, the market is expected to gradually restart, with an overall trend likely to fluctuate upward, though the upward momentum may be constrained. Prior to the holiday, SHFE nickel and stainless steel futures strengthened due to news of tightened nickel ore quotas in Indonesia, but later pulled back slightly as funds took profits. On the supply side, multiple stainless steel mills concentrated on annual equipment maintenance, leading to a significant expected decline in production schedules. On the demand side, downstream end-users also entered the holiday period, halting purchases and creating a weak supply-demand dynamic. A slight rise in raw material prices provided some cost support, but steel mills did not experience significant losses. Coupled with the holiday-induced shutdown of downstream users and traders, social inventory saw a notable buildup, restraining price increases. After the holiday, the spot market is gradually restarting, though some traders remain on holiday in the first week. Market transactions are expected to gradually increase, with spot prices likely to hold up well in the short term. In the medium to long term, as downstream operations resume at a steady pace, a recovery is anticipated. Supportive factors in the futures market remain. Against a backdrop of market weakness, downstream end-users were cautious in pre-holiday stockpiling and are expected to enter a restocking phase after the holiday. Additionally, with the approach of the traditional peak consumption season of "Golden March, Silver April," demand is likely to recover first, followed by supply, potentially leading to further increases in stainless steel prices.

The London Metal Exchange has lost its benchmark status in a key part of the nickel market since last year’s massive short squeeze, according to one of the biggest producers.