SMM April 7 reported that SS futures retreated after a rapid rise. After the morning opening, SS futures once surged quickly before pulling back, dragged down by declines in non-ferrous futures. As of the midday close, SS futures settled at 14,135 yuan/mt. Spot market side, affected by the overall fluctuations in futures, spot traders continued to maintain a strategy of holding quotes firm while shipping; downstream end-users remained cautious with a wait-and-see sentiment, purchasing mainly on a just-in-need basis. Inquiries and transactions were mediocre, and market quotes remained largely stable.
The most-traded SS futures contract retreated after a rapid rise. At 10:15 AM, SS2605 was quoted at 14,200 yuan/mt, up 50 yuan/mt from the previous trading day. Spot premiums for 304/2B in the Wuxi area were in the range of 220-420 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 remained flat and in Foshan remained stable; cold-rolled 316L/2B coils in Wuxi remained flat; hot-rolled 316L/NO.1 coils in Wuxi were quoted flat; cold-rolled 430/2B coils in both Wuxi and Foshan remained stable.
The stainless steel market is currently in the traditional peak consumption season of "Golden March and Silver April." Downstream demand fundamentals recovered compared to the earlier period, with end-user purchases continuing at a just-in-need pace, and overall trading volume was sufficient to support basic market vitality. However, affected by macro news disturbances and futures fluctuations, downstream end-user clients still held a wait-and-see sentiment with no willingness to stockpile, and transactions fluctuated with changes in news. Futures side, the Iran geopolitical conflict remained difficult to resolve in the short term, and macro news uncertainty continued to cause notable disturbances. SS futures continued to move sideways this week, failing to form a clear breakout direction and unable to effectively drive the spot market. Supply and inventory side, stainless steel mills maintained relatively high production schedules in April, with the high supply pattern unchanged, putting certain digestion pressure on the market. Coupled with month-end concentrated distribution of goods from steel mills to the market, although downstream demand continued to provide just-in-need support, stainless steel social inventory rose somewhat this week, but the increase was limited. Steel mills currently focused mainly on holding quotes firm while shipping to ease inventory and supply pressure. Cost side, nickel ore prices remained firm, leaving limited room for nickel pig iron price compression. However, stainless steel mills were already on the verge of cost-related losses, with low acceptance of high-priced raw materials. Back-and-forth negotiations between upstream and downstream persisted, keeping stainless steel production costs running relatively stable. Earlier market expectations of cost support for stainless steel prices had gradually dissipated. Overall, the core contradiction in the stainless steel market this week lay in the mismatch between high supply and steady yet cautious demand. Although the "Golden March and Silver April" peak season supported downstream demand fundamentals, and the cost side also limited the downside space for stainless steel prices to some extent, the strong wait-and-see sentiment among downstream end-users, significant transaction disturbances from news, and persisting macro news uncertainty all weighed on the market. Based on comprehensive analysis, whether stainless steel prices can strengthen and move higher going forward still depends on further impetus from the macro news front.
