[SMM Analysis] Macro Headwinds Materialize, Futures Recover; Pre-Holiday Essential Demand Release Drives Stainless Steel Inventory Destocking

Published: Sep 24, 2026 16:48 (GMT+8)

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[SMM Analysis] Macro Headwinds Materialize, Futures Recover, Pre-Holiday Just-in-Time Demand Releases Stainless Steel Inventory Destocking SMM, September 24: This week, stainless steel social inventory continued its destocking trend, with the inventory midpoint moving steadily lower and pressure from accumulated market supply easing further. Total inventory in the two core markets of Wuxi and Foshan pulled back significantly, and the pace of destocking widened this week. This week, recovering macro sentiment combined with pre-holiday just-in-time demand release to drive continued stainless steel inventory destocking. With the US Fed's rate hike now landed, the macro headwinds that had weighed on the market were largely priced in, significantly easing bearish market sentiment. SS futures strengthened in a recovery move, lifting spot prices in tandem and visibly reviving market trading activity. Ahead of the Mid-Autumn Festival holiday, downstream end-users concentrated their release of phased just-in-time procurement demand to ensure normal production before the break, boosting inquiry and transaction activity and improving the efficiency of inventory digestion. Under the combined tailwinds of recovering futures sentiment, warming spot prices, and concentrated pre-holiday just-in-time restocking, market supply was effectively absorbed, driving social inventory steadily lower. Overall, the materialization of macro headwinds restoring market confidence, stronger futures lifting spot prices, and concentrated pre-holiday just-in-time demand release from end-users were the core drivers behind this week's sustained and substantial stainless steel inventory destocking. At the current stage, market pessimism is gradually fading, the low-level recovery in futures continues, and with pre-holiday just-in-time demand providing support, the pace of inventory destocking keeps strengthening. In the short term, as macro headwinds are fully priced in and market sentiment steadily recovers, inventory buildup pressure continues to ease. Supported by the orderly release of end-user just-in-time demand, inventory is likely to extend its mild destocking trend...

SMM, September 24: This week, stainless steel social inventory continued its destocking trend, with the inventory midpoint moving steadily lower and pressure from accumulated market supply easing further. Total inventory in the two core markets of Wuxi and Foshan pulled back notably, and the pace of destocking widened this week.

This week, recovering macro sentiment combined with pre-holiday just-in-time demand release to drive continued destocking of stainless steel inventory. With the US Fed's rate hike now landed, the macro headwinds that had previously pressured the market were largely cleared, significantly easing bearish market pessimism. SS futures strengthened in tandem, lifting spot prices and markedly reviving market trading activity. Ahead of the Mid-Autumn Festival holiday, downstream end-users released concentrated just-in-time procurement demand to ensure normal production before the holiday, boosting inquiry and transaction activity and improving the efficiency of inventory drawdown. Supported by the combined tailwinds of improving futures sentiment, recovering spot prices, and concentrated pre-holiday just-in-time restocking, market supply was effectively absorbed, driving a steady pullback in social inventory.

Overall, the clearing of macro headwinds restored market confidence, stronger futures lifted spot prices, and end-user just-in-time demand was released in concentrated fashion ahead of the holiday, serving as the core drivers of this week's sustained and substantial destocking of stainless steel inventory. At this stage, market pessimism is gradually fading, the low-level recovery in futures is continuing, and with pre-holiday just-in-time demand providing a floor, the pace of destocking keeps strengthening. In the short term, as macro headwinds are fully cleared and market sentiment steadily recovers, inventory buildup pressure continues to ease. Supported by the orderly release of end-user just-in-time demand, inventory is likely to maintain a mild destocking trend and operate at low levels. Going forward, close attention should be paid to the sustainability of the SS futures recovery, the strength of post-holiday end-use demand recovery, the follow-through in market transactions, and changes in the pace of destocking.

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