[SMM Analysis] Review of Stainless Steel Market During 2026 Chinese New Year Holiday and Post-Holiday Outlook [SMM Analysis]

During the Chinese New Year holiday, the domestic stainless steel market entered a seasonal shutdown phase, with the SHFE also suspending trading and spot transactions halting, resulting in no significant price fluctuations. Overall, before the holiday, the market exhibited a pattern of strengthening futures, stagnant spot transactions, weak supply and demand, and significant inventory buildup. After the holiday, the market is expected to gradually restart, with an overall trend likely to fluctuate upward, though the upward momentum may be constrained.

Prior to the holiday, SHFE nickel and stainless steel futures strengthened due to news of tightened nickel ore quotas in Indonesia, but later pulled back slightly as funds took profits. On the supply side, multiple stainless steel mills concentrated on annual equipment maintenance, leading to a significant expected decline in production schedules. On the demand side, downstream end-users also entered the holiday period, halting purchases and creating a weak supply-demand dynamic. A slight rise in raw material prices provided some cost support, but steel mills did not experience significant losses. Coupled with the holiday-induced shutdown of downstream users and traders, social inventory saw a notable buildup, restraining price increases.

After the holiday, the spot market is gradually restarting, though some traders remain on holiday in the first week. Market transactions are expected to gradually increase, with spot prices likely to hold up well in the short term. In the medium to long term, as downstream operations resume at a steady pace, a recovery is anticipated. Supportive factors in the futures market remain. Against a backdrop of market weakness, downstream end-users were cautious in pre-holiday stockpiling and are expected to enter a restocking phase after the holiday. Additionally, with the approach of the traditional peak consumption season of "Golden March, Silver April," demand is likely to recover first, followed by supply, potentially leading to further increases in stainless steel prices.