[SMM Nickel Flash] On June 3, the SMM high-grade NPI market sentiment index was 2.49, up 0.01 MoM; the high-grade NPI upstream sentiment index was 3.04, up 0.02 MoM; and the high-grade NPI downstream sentiment index was 1.94, up 0.01 MoM. The NPI market today continued its structural divergence and stagnant price pattern overall.

[SMM Daily Comment: Significant Premium Stratification, Structural NPI Market Trend Continues] June 3 — The SMM upstream sentiment factor for high-grade NPI was 3.04, up 0.02 MoM, and the downstream sentiment factor for high-grade NPI was 1.94, up 0.01 MoM.

[SMM Stainless Steel Daily Review] SS Futures Strength Lifted Spot Prices; Producers Held Prices Firm, Supporting Short-term Price Resilience SMM, June 2: SS futures rose sharply. Driven by the overall strength in non-ferrous metal futures, SS also rose. As of the close, the most-traded SS contract settled at 15,065 yuan/mt. Spot market side, driven by the sharp rise in SS futures, stainless steel spot prices were raised in tandem. Fueled by the sentiment to rush to buy amid continuous price rise and hold back amid price downturn, trading activity picked up. Although the market was currently in the off-season with slightly insufficient confidence, stainless steel producers still had the willingness to hold prices firm, and social inventory had not yet shown significant accumulation. Despite slightly sluggish downstream demand, short-term prices were expected to remain firm. The most-traded SS futures contract strengthened and probed higher. At 10:15 AM, SS2607 was quoted at 14,149 yuan/mt, up 110 yuan/mt from the previous trading day. Spot premiums for 304/2B in the Wuxi area were in the range of 275-725 yuan/mt. In the spot market, the average price of cold-rolled 201/2B coil in Wuxi remained flat; for cold-rolled untrimmed 304/2B coil, the average price in Wuxi rose 100 yuan/mt and in Foshan rose 25 yuan/mt; cold-rolled 316L/2B coil prices in Wuxi rose 150 yuan/mt; hot-rolled 316L/NO.1 coil in Wuxi rose 50 yuan/mt; cold-rolled 430/2B coil in both Wuxi and Foshan remained stable. This week, the stainless steel market saw futures edge up slightly while spot prices stabilized sideways. The futures-spot linkage was weak, and the market officially entered the traditional consumption off-season, with intensifying tug-of-war between longs and shorts on fundamentals. Traders had weak confidence in the market outlook...

[SMM Daily Comment: Market Overall Stagnant and Volatile, NPI Structural Trend Continues] June 2 — The SMM high-grade NPI upstream sentiment factor was 3.02, down 0.03 MoM, and the high-grade NPI downstream sentiment factor was 1.93, down 0.01 MoM.

May high-grade NPI prices fell despite tighter costs, as nickel futures retreated, stainless margins weakened, and scrap regained its cost advantage. Indonesian policy and production-cut expectations built a floor, but weak downstream demand capped any rebound.

[SMM Daily Comment: Rising Policy Uncertainty Fuels Strong Wait-and-See Sentiment in the Market] June 1 — The SMM upstream sentiment index for high-grade NPI was 3.05, down 0.06 MoM, while the downstream sentiment index for high-grade NPI was 1.94, down 0.03 MoM.

[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 Daily Review] SS Futures Moved Sideways as Spot Prices Stabilized, Stainless Steel Off-Season Tug-of-War Intensified SMM, May 29 — SS futures remained in the doldrums. Despite a relatively firm performance during the night session, prices dipped after the morning open, dragged down by falling SHFE nickel, and fluctuated lower. As of the close, the most-traded SS contract settled at 14,870 yuan/mt. Spot market side, SS futures fluctuated within a relatively small range during the week, and most stainless steel spot traders mainly shipped at stable quoted prices. The market generally reported that the industry was gradually entering the off-season, with downstream demand continuing to weaken. Although some stainless steel mills announced production cuts and maintenance, overall expected planned production was only marginally lower, and destocking pressure remained significant. The most-traded SS futures contract held up well. At 10:15 AM, SS2607 was quoted at 14,885 yuan/mt, up 20 yuan/mt from the previous trading day. Spot premiums for 304/2B in the Wuxi area ranged from 285-685 yuan/mt. In the spot market, the average price of cold-rolled 201/2B coils in Wuxi held flat; for cold-rolled untrimmed 304/2B coils, Wuxi prices held steady and Foshan average prices held steady; cold-rolled 316L/2B coils in Wuxi held steady; hot-rolled 316L/NO.1 coils in Wuxi were quoted flat; cold-rolled 430/2B coils in both Wuxi and Foshan held steady. This week, stainless steel futures edged up slightly while spot prices stabilized, with weak futures-spot linkage. The market officially entered the traditional consumption off-season, and the fundamental tug-of-war between longs and shorts intensified. Traders had weak confidence in the market outlook with strong wait-and-see sentiment, but the slight recovery in futures sustained market activity. Combined with steel mill agents stabilizing prices and ship...

[SMM Daily Comment: Tight Structure, NPI Prices Held Steady at High Levels] On May 29, SMM's upstream sentiment factor for high-grade NPI was 3.11, up 0.01 MoM, while the downstream sentiment factor for high-grade NPI was 1.97, flat MoM.