[SMM Stainless Steel Scrap Market Weekly Review] Futures Bottom Out to Support Market, Bull-Bear Balance Keeps Scrap Narrowly Stable This week, prices of 304-grade stainless steel scrap off-cuts in east China remained stable, with a quotation range of 10,400-10,500 yuan/mt; the same specification of stainless steel scrap off-cuts in Foshan also remained stable, with a price range of 10,300-10,600 yuan/mt. From a raw material production cost analysis, the cost of producing stainless steel entirely using stainless steel scrap is approximately 14,580.48 yuan/mt, while the cost of using high-grade NPI reaches 15,113.2 yuan/mt, with a considerable cost spread still maintained between the two. Stainless steel scrap prices remained generally stable this week. The substitute raw material high-grade NPI was affected by expectations of production cuts at stainless steel mills in the off-season, with prices continuing to pull back; the overall sentiment on the raw material side was weak, making it difficult to drive an uptick in stainless steel scrap. However, SS futures bottomed out during the week, effectively repairing market pessimism; meanwhile, spot prices of stainless steel products only edged down, highlighting the resilience of the spot market. Under the hedging effect of multiple factors, stainless steel scrap prices remained firm. Overall, the market has entered the traditional consumption off-season for stainless steel. Expectations for production schedules at stainless steel mills have been continuously revised downward, smelting margins at steel mills have narrowed compared with earlier periods. Additionally, macro market uncertainty remains relatively high, and bearish risks are gradually accumulating. It is expected that stainless steel scrap prices may face some pullback risks going forward.……

[SMM Analysis] Weak Off-Season Demand and Firm Raw Materials Drive Up Stainless Steel Costs, Narrowing Profits This week, stainless steel production costs edged up slightly, while product prices remained stable overall, leading to a slight narrowing of steel mill profit margins. Using 304 cold-rolled as the calculation benchmark, the current raw material-calculated profit margin was 2.16%, while the inventory raw material-calculated profit margin was 1.44%. Nickel-based raw material cost side, this week high-grade NPI prices edged up. Although the market has entered the traditional consumption off-season for stainless steel, with weak end-use demand, insufficient market confidence, and strong steel mill desires to bargain down prices, the limited production cuts for 300-series stainless steel in June meant a relatively small decline in demand for high-grade NPI. Combined with persistent disturbances from Indonesian news and a firm stance on holding prices from upstream players, these factors collectively drove high-grade NPI prices to hold up well. As of this Friday, the mainstream grade of 10%-12% high-grade NPI rose by 0.5 yuan per nickel unit, closing at 1,144 yuan per nickel unit. Stainless steel scrap market side, this week stainless steel scrap prices edged up. Driven by the linkage effect of firm spot finished steel and strong high-grade NPI, scrap prices also moved higher synchronously. However, under the suppression of multiple bearish factors such as weak demand in the traditional off-season, tight supply of tax invoices, and steel mill process limitations, its upside room was limited. Currently, bullish and bearish factors are counterbalancing each other, and it is expected that in the short term, stainless steel scrap prices will mainly remain stable. As of this Friday, mainstream 304 off-cut prices in Shanghai rose by 100 yuan/mt, with the latest quotation at approximately 10,450 yuan/mt. Chrome-based raw material cost side, this week high-carbon ferrochrome prices remained stable. Although in the traditional consumption off-season for stainless steel, in June steel...

[SMM Stainless Steel Scrap Weekly Review] Scrap Edges Up on Raw Material Linkage, Off-Season Constraints Cap Gains This week, the price of 304 stainless steel scrap off-cuts in east China edged up, with a quotation range of 10,400-10,500 yuan/mt. In the Foshan area, off-cuts of the same specification moved higher in tandem, trading in a range of 10,300-10,600 yuan/mt. From a raw material cost analysis perspective, the current production cost of stainless steel using 100% stainless steel scrap is approximately 14,580.48 yuan/mt, while the cost using only high-grade NPI stands at 15,153.78 yuan/mt, maintaining a significant cost spread between the two. Stainless steel scrap prices edged up this week. During the week, SS futures retreated after a rapid rise overall, while spot stainless steel prices fluctuated narrowly and held firm overall, providing a stable foundation for the stainless steel scrap market. Meanwhile, the alternative raw material high-grade NPI market continued to hold up well, with prices edging higher. The positive overall sentiment in the raw material segment spurred stainless steel scrap prices to rise in tandem. However, the market has now entered the traditional consumption off-season for stainless steel, with weak downstream end-use demand. Coupled with production cuts and maintenance at domestic steel mills, raw material demand expectations have weakened somewhat. The industry-wide issue of tight tax invoices has yet to be effectively resolved, continuing to constrain market trading activity. At the same time, recent grade degradation issues in high-grade NPI require steel mills to supplement nickel content with high grade nickel products, and combined with limitations in their production processes, it remains difficult for steel mills to significantly increase their use of stainless steel scrap. Although stainless steel scrap retains a favorable cost advantage over high-grade NPI, multiple bearish off-season factors on...

[SMM Analysis] Stainless Steel Costs Edged Down with Prices Holding Steady, Steel Mill Profits Rebounded Slightly This week, stainless steel production costs edged down while prices remained generally stable, resulting in a slight expansion in steel mill profit margins. Using 304 cold-rolled as the calculation benchmark, the current raw material-based profit margin was 2.33%, while the low-level inventory raw material-based profit margin reached 3.39%. Nickel-based raw material costs: high-grade NPI prices edged up this week. Although the traditional consumption off-season for stainless steel was approaching, steel mills had limited acceptance of high-priced raw materials and adopted a cautious purchasing stance, with mediocre performance in transactions. However, supported by expectations of tight high-grade NPI supply, the market showed a strong willingness to hold prices firm, and prices remained firm overall. As of this Friday, mainstream 10-12% grade high-grade NPI rose 3 yuan per nickel unit, closing at 1,143.5 yuan/nickel unit. Stainless steel scrap market: stainless steel scrap prices pulled back slightly this week. Although SS futures edged up, the spillover effect was weak and difficult to transmit to the spot market. With the consumption off-season approaching, downstream purchasing attitudes were cautious, and finished product prices lacked upward momentum. The high-grade NPI rally slowed down with weak transactions, providing insufficient support from the raw material side. Compounded by unresolved tax invoice tightness, fermentation of rumors about steel mill production cuts in June, and weakening demand expectations, multiple bearish factors dragged down prices. However, stainless steel scrap still held an economic advantage over NPI, with the cost price spread providing a floor and limiting the downside. In the short term, constrained by tax invoice issues and weakening off-season demand, prices are expected to remain relatively stable going forward. As of this Friday, mainstream 304 off-cuts prices in Shanghai fell 100 yuan/mt, with the latest quote at approximately 10,350 yuan/mt. Chromium-based raw materials...

[SMM Stainless Steel Scrap Market Weekly Review] Off-Season Bearish Factors Dragged Stainless Steel Scrap Prices to Pull Back Slightly, Cost Advantages Held Up the Market Floor This week, prices of 304 stainless steel off-cuts in east China pulled back slightly, with a quotation range of 10,300-10,400 yuan/mt. Prices of the same-grade stainless steel off-cuts in Foshan remained stable, with a price range of 10,150-10,450 yuan/mt. From the perspective of raw material production costs, the cost of producing stainless steel entirely from stainless steel scrap was approximately 14,459.87 yuan/mt, while the cost of production entirely using high-grade NPI reached 15,149.69 yuan/mt. The price spread between the two remained considerable. Stainless steel scrap prices pulled back slightly this week. Although SS futures saw a slight upward probe during the week, the upward momentum from futures was relatively weak and difficult to transmit to the spot market. Coupled with the market gradually approaching the traditional consumption off-season for stainless steel, downstream end-user purchase sentiment turned cautious overall, and spot prices of finished stainless steel products remained largely stable, lacking upward momentum. Meanwhile, the pace of price increases for the alternative raw material high-grade NPI also slowed down simultaneously, with weak market transaction performance and insufficient overall support from the raw material side. Additionally, the long-standing industry issue of tight tax invoices remained unresolved, and news of production cuts and maintenance at individual stainless steel mills in June emerged. Market expectations for raw material demand weakened, and multiple bearish factors collectively dragged stainless steel scrap prices to pull back slightly during the week. Despite the slight weakening of scrap prices this week, stainless steel scrap still maintained favorable cost advantages compared to high-grade NPI. The significant production cost spread continued to play a substitution role, providing...

[SMM Stainless Steel Scrap Market Weekly Review] Bearish Factors Converge to Weaken Stainless Steel Scrap, Cost Advantages Hold Price Floor This week, prices of 304 stainless steel scrap off-cuts in east China pulled back, with a quotation range of 10,400-10,500 yuan/mt. Off-cuts of the same specification in Foshan weakened, with a price range of 10,150-10,450 yuan/mt. From a raw material production cost analysis, the cost of producing stainless steel entirely from stainless steel scrap was approximately 14,580.48 yuan/mt, while the cost of production entirely using high-grade NPI reached 15,125.2 yuan/mt. Stainless steel scrap prices fell and pulled back this week. The stainless steel finished product spot market was overall in the doldrums, with spot prices continuously under pressure. Meanwhile, steel mills continued to push for lower prices on the alternative raw material high-grade NPI, creating an overall bearish atmosphere on the raw material side. Combined with major steel mills lowering their molten steel quotations during the week, multiple bearish factors converged to drive stainless steel scrap prices further down. The supporting factors cushioning the decline in stainless steel scrap were clearly visible: positive news emerged in the market this week that issues related to reverse invoicing and tight tax invoices might be eased, with industry transaction pain points expected to be alleviated. Steel mills' purchase demand for stainless steel scrap is expected to increase going forward. At the same time, stainless steel scrap continued to maintain favorable cost advantages over high-grade NPI. Coupled with the fact that steel mills still had profit margins on the production side, production and procurement enthusiasm was sustained, and overall rigid demand remained robust, continuously providing floor support for stainless steel scrap prices. Overall, the stainless steel scrap market this week exhibited a pattern of "weakening spot prices, cost-supported floor, and expectations of recovery...

[SMM Daily Comment: Tightening Supply Expectations Heated Up, Steel Scrap Price Decline Restrained NPI Price Gains] May 21 — The SMM high-grade NPI upstream sentiment factor was 3.12, up 0.02 MoM, and the high-grade NPI downstream sentiment factor was 2.08, down 0.04 MoM.

[SMM Stainless Steel Scrap Market Weekly Review] Weak Futures Dragged Down Stainless Steel Scrap, Cost Advantages Underpinned the Market This week, prices of 304 stainless steel scrap off-cuts in east China pulled back, with the quotation range at 10,600-10,700 yuan/mt; prices of the same-spec stainless steel scrap off-cuts in Foshan held steady, with the price range at 10,400-10,700 yuan/mt. From a raw material production cost perspective, the cost of producing stainless steel entirely from stainless steel scrap was approximately 14,821.71 yuan/mt, while the cost of production entirely using high-grade NPI reached 15,173.94 yuan/mt. Stainless steel scrap prices declined and pulled back this week. SS futures were generally in the doldrums, with futures continuously under pressure, which in turn transmitted to the spot market, driving spot stainless steel finished product prices to pull back in tandem. The alternative raw material high-grade NPI also declined simultaneously, but its own raw material fundamentals remained relatively firm, limiting the price drop. As stainless steel spot prices trended downward, steel mills still retained certain smelting profits, production willingness stayed high, and steel mill production schedules showed no reduction. Meanwhile, with the limited decline in high-grade NPI, the cost advantages of stainless steel scrap relative to high-grade NPI became more prominent during the week. Even though industry tax invoice issues persisted, they did not affect steel mills' procurement pace, and procurement demand for stainless steel scrap with better cost advantages remained solid. Overall, the stainless steel scrap market this week exhibited a pullback pattern characterized by "weak futures, resilient raw materials, and demand underpinning." Bearish futures dominated the short-term trend, but rigid demand and cost price spread advantages formed strong support. Tax invoices...

[SMM Analysis] Macro Sentiment Weighed on Futures, Stainless Steel Profits Narrowed Amid Raw Material Divergence Stainless steel production costs pulled back this week, and steel mill profits narrowed, with profit divergence driven by differing raw material inventory costs. Using 304 cold-rolled as the calculation benchmark, the profit margin based on current raw material costs was 1.87%, while the profit margin based on low-level inventory raw material costs was 4.48%. Overall industry profitability remained moderate, steel mills maintained high production schedules, and operating rates stayed stable. Nickel-based raw material costs: Nickel-based raw material prices came under pressure this week, largely driven by futures sentiment. SHFE nickel and stainless steel futures declined consecutively, pulling high-grade NPI market prices down in tandem. However, cost support in the NPI industry remained strong, with widespread firm-pricing sentiment across the market. Additionally, high-grade NPI sources with higher nickel content were scarce within the industry, resulting in structural price divergence in NPI, with prices for high-grade NPI above 12% grade remaining firm. As of this Friday, mainstream 10-12% grade high-grade NPI fell 6 yuan per nickel unit, closing at 1,145 yuan/nickel unit. Stainless steel scrap market: Stainless steel scrap prices pulled back this week. SS futures trended weaker, dragging spot prices lower in tandem. Although high-grade NPI also declined, the drop was limited, highlighting the cost advantage of stainless steel scrap. Steel mill smelting profits remained moderate, production schedules stayed high, and procurement demand remained solid. The overall picture showed "weak futures, resilient raw materials...

[SMM Stainless Steel Daily Review] Macro Disturbances Dragged SS Futures Lower; Low Inventory Pressure and Rigid Demand Supported Stainless Steel Spot Prices SMM, May 15 — SS futures continued to be in the doldrums. Non-ferrous metal futures extended the previous day's decline, and SS also fluctuated downward in tandem. As of the morning close, the most-traded SS contract was quoted at 14,825 yuan/mt. Spot market side, dragged by the persistently weak SS futures, stainless steel spot prices pulled back in tandem. However, stainless steel social inventory has been on an overall downward trend recently, and traders faced relatively small shipment pressure. Market confidence remained stable, and price declines were relatively limited. The most-traded SS contract fell and pulled back. At 10:15 AM, SS2605 was quoted at 14,890 yuan/mt, down 60 yuan/mt from the previous trading day. Spot premiums for 304/2B in the Wuxi area were in the range of 380-680 yuan/mt. In the spot market, the average price of cold-rolled 201/2B coils in Wuxi remained flat; for cold-rolled untrimmed 304/2B coils, the average price in Wuxi fell 100 yuan/mt, and the average price in Foshan fell 100 yuan/mt; cold-rolled 316L/2B coils in the Wuxi area held steady; hot-rolled 316L/NO.1 coils were quoted stable in Wuxi; cold-rolled 430/2B coils in both Wuxi and Foshan held steady. The stainless steel market was dragged by the weak and volatile futures, with notable downward pressure, but overall spot price declines remained limited, highlighting the divergence between futures and spot. Downstream end-users adopted a cautious wait-and-see stance due to macro uncertainties, with no concentrated restocking observed. However, rigid demand purchases remained solid, and the resilience of rigid demand provided a foundation for spot prices...