SS Weakness and Sluggish Demand: Stainless Steel Scrap Cost Advantages Fail to Counter Pessimistic Expectations [SMM Stainless Steel Scrap Market Weekly Review]

Published: Jul 10, 2026 15:04

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[SMM Stainless Steel Scrap Market Weekly Review] SS Weakness and Sluggish Demand: Stainless Steel Scrap’s Cost Advantage Struggles Against Bearish Expectations This week, prices of 304 stainless steel scrap off-cuts in east China pulled back, with a quotation range of 10,100-10,200 yuan/mt; prices for the same grade of stainless steel scrap in the Foshan area also fell back, ranging from 10,000-10,300 yuan/mt. From the raw material cost side analysis, the cost of producing stainless steel entirely from stainless steel scrap is currently about 14,218.64 yuan/mt, while the cost of using high-grade NPI reaches 14,972.65 yuan/mt, still maintaining a large cost spread. This week, stainless steel scrap prices drifted lower. SS futures pulled back throughout the week, with bearish sentiment spreading on the futures side, directly dragging down spot prices of stainless steel products slightly. The weak futures set the overall market tone. On the spot side, mainstream stainless steel mills adopted a cautious approach due to higher production costs and uncertain market outlook, as their published high-grade NPI tender prices were low, further weighing on sentiment in the nickel-based raw material and scrap markets. As a result, some stainless steel mills suspended purchases of stainless steel scrap during the week, market buying interest weakened noticeably, overall trading was subdued, and the price center of stainless steel scrap continued to shift lower. Overall, the cost advantage struggled to offset the suppression from bearish market expectations. This week, stainless steel scrap still held a significant economic advantage over high-grade NPI, and the cost substitution logic has not reversed, providing some bottom support for scrap prices. However, overall market sentiment remains weak, steel mill cost pressure…

This week, prices for 304 stainless steel scrap off-cuts in east China pulled back, with a quotation range of 10,100-10,200 yuan/mt. The same specification scrap in Foshan saw a synchronized pullback, with its price range at 10,000-10,300 yuan/mt. Analyzing production costs from the raw material side, the current cost to produce stainless steel entirely from stainless steel scrap is approximately 14,218.64 yuan/mt, while the cost using entirely high-grade NPI reaches 14,972.65 yuan/mt, maintaining a large cost differential between the two.

Stainless steel scrap prices drifted lower this week. SS futures broadly pulled back over the course of the week, with bearish sentiment persistently spreading on the futures side, directly dragging stainless steel product spot prices to a synchronous slight pullback. Weakness in futures dictated the overall market tone. On the spot side, mainstream steel mills, influenced by rising production costs and uncertainty about the subsequent market outlook, adopted a cautious operational stance. The lower tender prices announced for high-grade NPI further weighed on market sentiment for nickel-based raw materials and the scrap market. Consequently, some stainless steel mills suspended stainless steel scrap purchases during the week, with market buying momentum visibly weakening. Overall transaction performance was weak, and the price center of stainless steel scrap continued to shift downward.

Overall, cost side advantages struggled to offset the suppression from bearish market expectations. This week, stainless steel scrap still held a significant economic advantage over high-grade NPI, with the logic of feedstock substitution intact, offering some floor support for scrap prices. However, the current market remained broadly weak in sentiment. Combined with cost pressure on steel mills, insufficient confidence in the future outlook, conservative raw material procurement, and sluggish end-use demand, market caution and pessimism dominated the trading pace. Under the resonance of multiple bearish factors, the cost advantage of scrap failed to translate into market support, unable to reverse the doldrums in market performance. Short-term stainless steel scrap prices are expected to continue consolidating on a weak note.

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