Futures strength drives stainless steel scrap to edge up, while weak off-season demand caps room for price increases[SMM Stainless Steel Scrap Market Weekly Review]

Published: Jul 24, 2026 16:34

Save

[SMM Stainless Steel Scrap Market Weekly Review] SS Futures Strength Drives Slight Uptick in Stainless Steel Scrap, Off-Season Demand Weakness Caps Price Gains This week, prices for 304 stainless steel scrap off-cuts in east China edged up, with quotations ranging between 10,400-10,500 yuan/mt. Prices in Foshan rose in tandem, with a price range of 10,300-10,600 yuan/mt. An analysis of raw material production costs shows that the cost of producing stainless steel entirely from stainless steel scrap is approximately 14,607.48 yuan/mt, while the cost using high-grade NPI reaches 14,962.08 yuan/mt, with a cost spread persisting between the two. Stainless steel scrap prices edged up this week. SS futures strengthened overall during the week, and the positive sentiment from the futures side was smoothly transmitted to the spot market, driving a slight concurrent rise in spot prices for finished stainless steel. However, stainless steel mills continued to push for lower prices for high-grade NPI, and amid the tug-of-war between upstream and downstream, high-grade NPI prices held steady for the time being. Overall momentum from the raw material side remained weak, but stainless steel scrap rose in tandem with the strengthening pace of finished product spot cargoes, holding up well overall. With high-grade NPI prices remaining stable this week, the economic advantage of stainless steel scrap narrowed notably, and the cost substitution benefit weakened. In summary, futures provided support for market prices, but off-season fundamentals continued to cap price upside. The market is currently in the traditional consumption off-season for stainless steel, downstream end-use demand remains sluggish, overall industry production pulled back, and the rigid demand for stainless steel scrap weakened accordingly. The purchasing sentiment among steel mills turned cautious, and raw material procurement overall this week...

This week, prices of 304 stainless steel scrap off-cuts in east China gained, with a quotation range of 10,400-10,500 yuan/mt; in Foshan, prices of 304 stainless steel scrap off-cuts also edged up, with a price range of 10,300-10,600 yuan/mt. Raw material cost analysis shows that the current cost of producing stainless steel entirely from stainless steel scrap is approximately 14,607.48 yuan/mt, while the cost using high-grade NPI reaches 14,962.08 yuan/mt, leaving a certain cost difference between the two.

This week, stainless steel scrap prices edged up. During the week, SS futures trended higher overall, and the bullish sentiment smoothly transmitted to the spot market, driving spot prices of stainless steel products slightly higher in tandem. However, stainless steel mills continued to push for lower prices on high-grade NPI. Amid the tug-of-war between upstream and downstream, high-grade NPI prices remained stable for the time being, and the raw material side showed weak linkage momentum overall. Yet, stainless steel scrap followed the strength of product spot prices and rose in tandem, holding up well overall. This week, high-grade NPI prices were stable, which noticeably narrowed the economic advantage of stainless steel scrap over it, weakening the cost substitution dividend. Overall, futures support spot prices, but off-season fundamentals continue to cap market gains. The market is currently in the traditional consumption off-season for stainless steel, with persistently weak end-use demand downstream. Overall industry output has pulled back, and rigid demand for stainless steel scrap has similarly weakened. Mills' purchasing sentiment turned cautious, and raw material procurement was generally weak this week, with the market dominated by rigid demand transactions and lacking incremental restocking support. Under the dual impact of weak off-season demand and narrowing economic advantage, stainless steel scrap lacks upward momentum, and further price increases face notable pressure. In summary, in the near term, stainless steel scrap prices will maintain a steady consolidation supported by the resilience in futures, with limited upside room.

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or for more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

1 hour ago

Stainless steel products and costs edge up in tandem, steel mill profits remain stable [SMM Analysis]

[SMM Analysis] Stainless Steel Products and Costs Edge Up in Tandem, Steel Mill Profits Stable This week, stainless steel product prices and production costs edged up in tandem, while steel mill smelting profits remained basically stable overall. Based on calculations for 304 cold-rolling, the profit margin this week was 2.15% when accounting for raw materials at current prices and 1.11% when accounting for inventory raw materials, indicating that stainless steel mills still maintain certain smelting profits. Nickel-based raw materials side, high-grade NPI prices were largely stable this week. Although SHFE nickel and SS futures held up well overall during the week, the current traditional consumption off-season for stainless steel meant steel mills' purchase demand for NPI remained persistently weak, with very few actual transactions concluded recently. Amid the tug-of-war between longs and shorts, NPI prices remained steady this week. As of this Friday, the delivered duty-paid price for China's 10-12% grade Indonesian high-grade NPI remained stable at 1,132.5 yuan per nickel unit. Stainless steel scrap prices edged up this week, lifted by stronger SS futures driving spot prices higher. However, the temporarily stable high-grade NPI prices narrowed scrap's economic advantage. The current traditional consumption off-season persists, downstream demand is sluggish, and steel mills are cautious in purchasing, mainly transacting on a need-to basis. Under the dual constraints of weak demand and diminishing substitution benefits, upward momentum for stainless steel scrap was insufficient. In the short term, it will maintain largely stable consolidation supported by futures resilience, with limited upside room. As of this Friday, mainstream 304 off-cuts prices in Shanghai rose by 200 yuan/mt, quoted at 10,450 yuan/mt. Chrome-based raw materials side, high-carbon ferrochrome prices operated stably this week. Although ferrochrome supply remains relatively ample currently, coupled with demand pulling back amid off-season production cuts for stainless steel, recent high-cost ferrochrome...

1 hour ago

2 hours ago

[SMM Analysis] Futures Consolidating on a Strong Note Fail to Offset Weak Rigid Demand in the Off-Season, and Concentrated Arrivals Lead to a Minor Inventory Buildup of Stainless Steel.

[SMM Analysis] Futures Consolidate on a Strong Note, but Off-Season Demand Weakness and Concentrated Arrivals Lead to a Slight SS Inventory Buildup SMM, July 23: This week, stainless steel (SS) social inventory ended its earlier destocking trend, stopping its fall and rebounding overall with a slight buildup, as off-season inventory pressure re-emerged. Total inventory in the two core markets of Wuxi and Foshan edged up, rising from 921,300 mt on July 9, 2026, to 929,900 mt on July 23, up 0.93% WoW, shifting from a mild destocking phase to a period of accumulation. During the week, SS futures extended their previous consolidation on a strong note, helping to repair market trading sentiment to some extent. This drove a recovery in spot market inquiry activity early in the week, and periodic transactions saw a short-term rebound. However, support from off-season demand was insufficient, and the boost in sentiment from futures only generated a pulse-driven market. After the release of these periodic transactions, downstream procurement pace quickly slowed, and spot trades returned to a mediocre state, with a lack of sustained purchasing power from end-users. On the supply circulation front, the key factor behind this week's inventory buildup was the concentrated arrival and warehouse entry of shipments previously delayed by typhoon and rainstorm weather. This, combined with steel mills maintaining a normal distribution pace, led to a marked increase in the volume of spot cargo released, temporarily raising pressure on spot supply. Against a backdrop of weak off-season end-user purchases and slowing cargo consumption, the growth from concentrated arrivals could not be effectively absorbed by the market, ultimately driving the slight buildup in social inventory. Overall, the underlying bearish factors for inventory growth were weak off-season rigid demand from end-users and a lack of sustained transactions. The key drivers for this week's buildup were the concentrated arrivals after the typhoon, combined with normal distribution from mills and an increase in spot supply releases. This week's inventory...

2 hours ago

3 hours ago

[SMM Stainless Steel Daily Review] SS futures fell and pulled back, stainless steel spot transactions weakened and quoted prices held steady.

[SMM Stainless Steel Daily Review] SS Futures Edge Lower and Pull Back, Stainless Steel Spot Transactions Weaken and Quotes Hold Steady On July 24, SMM reported that SS futures showed an overall pattern of declining and pulling back. Nonferrous metals futures broadly pulled back, with SHFE nickel and SS futures weakening and pulling back in tandem. As of the close, the most-traded SS futures contract settled at 14,770 yuan/mt. In the spot market, affected by the weakening of SS futures and the concentrated release of earlier demand, market inquiries became less active, overall transactions weakened, and purchases were mainly need-based. However, with steel mill guidance prices remaining stable and spot prices having not previously followed the uptrend in futures, spot quotes continued to hold steady. Most-Traded SS Futures Contract. At 10:15 a.m., SS2609 traded at 14,690 yuan/mt, down 155 yuan/mt from the previous trading day. Spot premiums for 304/2B in Wuxi stood in a range of 330-730 yuan/mt. In the spot market, the average price of cold-rolled 201/2B coil in Wuxi was flat; for cold-rolled mill-edge 304/2B coil, average prices in Wuxi and Foshan were both flat; the price of cold-rolled 316L/2B coil in Wuxi fell by 75 yuan/mt; for hot-rolled 316L/NO.1 coil, quotations in Wuxi fell by 50 yuan/mt; cold-rolled 430/2B coil prices in both Wuxi and Foshan were flat. This week, a confluence of favorable macro and industry factors supported nickel and stainless steel futures, which consolidated on a strong note. On the macro front, US inflation expectations pulled back, while the US-Iran geopolitical conflict continued to unsettle market risk sentiment. On the industry front, the earlier limited growth in Indonesia’s RKAB nickel ore supplementary quotas...

3 hours ago