SMM

[SMM Daily Review of Stainless Steel Spot Market: Tariff Easing Expectations Boost Market Sentiment, Prices Explore Upside] SMM reported on May 7 that news of China-US negotiations emerged today, signaling expectations of a de-escalation in the tariff war. Stimulated by this favourable macro front, SS futures surged and strengthened rapidly after the opening of the daytime session. However, due to the absence of concrete tariff adjustment policies, market confidence struggled to sustain, and futures prices subsequently fluctuated downward and gradually pulled back. In the spot market, the brief strength in futures prices boosted market sentiment. Coupled with the release of restocking demand after the Labour Day holiday, spot quotes explored an upside. Nevertheless, the acceptance of high-priced resources by downstream end-users remained insufficient, with market transactions dominated by just-in-time procurement. It is worth noting that as restocking progresses after the holiday, the availability of low-priced cargoes has decreased, to some extent supporting the firm performance of spot prices. In the futures market, the most-traded contract 2506 surged and then pulled back. At 10:30 a.m., SS2506 was quoted at 12,750 yuan/mt. In the spot market, the average price of cold-rolled trimmed 304/2B coils in Wuxi was 13,050 yuan/mt. Currently, the supply side of the stainless steel market continues to fluctuate at highs. Facing the pressure of losses, producers have reduced the production of heavily loss-making 300-series stainless steel and shifted to increase the output of 200-series and 400-series products to optimize the steel grade structure. However, influenced by recent policy changes, market uncertainties have increased significantly. Downstream enterprises have generally adopted a cautious attitude, with procurement behavior becoming increasingly conservative and consumer demand remaining sluggish. This supply-demand imbalance has become the main constraint for the current stainless steel market.