According to SMM on September 30, SS futures currently remain in a consolidation pattern on a weak note. Dragged by further declines in SHFE nickel, SS moved lower in tandem, though the overall decline was relatively narrow. At the close, the most-traded SS contract settled at 1,370 yuan/mt. In the spot market, on the last trading day before the National Day holiday, actual transactions were limited, with most industry participants already in a pre-holiday mode and some even on early leave. Spot prices held steady as the market awaited post-holiday developments.
SS futures most-traded contract. At 10:15 a.m., SS2611 was quoted at 13,695 yuan/mt, down 120 yuan/mt from the previous trading day. Spot premiums for 304/2B in Wuxi were in the 525-875 yuan/mt range. In the spot market, the average price of Wuxi cold-rolled 201/2B coil remained flat; for cold-rolled 304/2B coil with mill edge, the Wuxi average price held steady and the Foshan average price was unchanged; Wuxi cold-rolled 316L/2B coil prices were flat; for hot-rolled 316L/NO.1 coil, Wuxi quotes were unchanged; cold-rolled 430/2B coil in both Wuxi and Foshan was flat.
This week, stainless steel futures showed a consolidation pattern with a weak but resilient tone. Nonferrous metals were broadly subdued during the week, with persistently lower SHFE nickel prices weighing on commodity sentiment. However, SS futures did not follow deeply lower, with the futures showing relative resilience, maintaining a weak consolidation pattern with strong downside support and no breakdown below key levels. The spot market continued its subdued tone as peak-season demand failed to materialize, with sluggish end-use demand capping upside and low valuations and expectations for production cuts underpinning prices. The market remains within the traditional September-October peak season window, but the pace of end-user recovery has continued to fall short of expectations, leaving the weak demand pattern unchanged. After the Mid-Autumn Festival holiday, the market approached the National Day long holiday. Pre-holiday stockpiling had largely been completed, and downstream users had no new restocking activity. The market gradually shifted into a pre-holiday lull, with sparse inquiries and persistently sluggish transactions, which became the core bearish factor pressuring spot prices. However, news of steel mill production cuts continued to build during the week, with industry supply contracting at the margin. Combined with stainless steel spot prices at relatively low levels for the year and a gradual slowdown in raw material price declines, multiple factors supported overall firm spot quotes, with losses relatively limited. Costs and profits continued to recover, further easing steel mill profit pressures. Stainless steel spot prices remained stable, while core raw material prices such as nickel-based and chromium-based materials extended their slight pullback. The price spread between finished products and raw materials continued to repair, gradually reversing the previous persistent losses. Steel mill production profits returned to positive territory, improving the industry's profitability environment. However, the profit recovery did not lift market sentiment, as persistently absent demand left spot prices lacking upward momentum. Overall, this week's stainless steel market presented a game of weakening overseas nickel prices, a resilient domestic market, peak-season demand disappointment, persistently sluggish transactions, production cut expectations providing a floor, and recovering steel mill profits. In the short term, persistently weak end-use demand and subdued overall market confidence, coupled with a lack of strong bullish drivers in fundamentals, have left stainless steel prices with severely insufficient momentum to push higher. However, macro headwinds have largely played out for now, steel mill production cuts are advancing steadily, social inventory remains at reasonably low levels with limited fluctuations, and spot prices are in the lower range for the year, so the market's deep downside is also constrained. On balance, the tug-of-war between longs and shorts in the stainless steel market is approaching equilibrium, with both upward and downward logics facing constraints, leaving the market overall locked in a sideways consolidation pattern where prices struggle to rise or fall significantly. Going forward, closely monitor the fluctuation pace of SS futures, the strength of end-use demand recovery after the holiday, the progress of steel mill production cuts, and the impact of raw material price changes on the cost side.
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