【SMM Steel】UK unveils steel strategy to boost green production, expand scrap use & strengthen trade protections

[SMM Analysis: Stronger Futures Combined with Pre-Holiday Stockpiling Drive Continued Modest Destocking in Stainless Steel Social Inventory] On April 30, SMM reported that stainless steel social inventory continued its destocking trend this week. Total inventory across the two core markets of Wuxi and Foshan declined slightly, falling from 949,400 mt on April 23, 2026 to 945,900 mt on April 30, down 0.37% WoW, with the destocking pace slowing down compared to the previous period. This week, SS futures continued to hold up well and broke above highs not seen since September 2023, continuously boosting market sentiment. Futures-spot arbitrage purchases by institutional traders were relatively active, serving as a key driver of inventory decline. Meanwhile, although downstream end-user clients remained cautiously on the sidelines given current high prices, with overall procurement dominated by just-in-time needs—consistent with the current market dynamics of "strong costs, weak demand"—the approaching Labour Day holiday still prompted some end-users to release just-in-time procurement stockpiling demand, providing some support for destocking. Additionally, steel mills recently maintained relatively low distribution volumes to the market, effectively easing inventory accumulation pressure. Combined with some cargo being diverted to other non-mainstream trading hubs, multiple factors jointly drove further decline in stainless steel social inventory this week. Overall, this week's continued destocking was primarily driven by active futures-spot arbitrage spurred by stronger SS futures, modest just-in-time stockpiling ahead of the Labour Day holiday, low steel mill distribution volumes, and cargo diversion to non-mainstream trading hubs. Current market sentiment was well-supported by futures, but...

The core logic of the South American steel market is that end-user demand drives everything. Consumption demand is the starting point, filled jointly by local production and imports; imports act as a regulating valve rather than a driving force.

Social inventory of HRC was 3.0182 million mt this week, down 151,200 mt from the previous week (-4.77% WoW, +41.59% YoY, +17.81% YoY on a lunar calendar basis). Mill inventory of HRC was 1.0153 million mt this week, down 1,500 mt from the previous week (-0.15% WoW, -7.28% YoY, -8.64% YoY on a lunar calendar basis). Total HRC inventory was 4.0335 million mt this week, down 152,700 mt from the previous week (-3.65% WoW, +25.00% YoY, +9.81% YoY on a lunar calendar basis).