Stainless Steel Arrivals Increased, Inventory Digestion Weakened with a Slight Inventory Decrease of 0.09% [SMM Analysis]

As of August 22, SMM social inventory of stainless steel was 972,100 mt, down 0.49% MoM and 0.09% WoW. Among them, the inventory of 200-series stainless steel was 280,000 mt, up 0.41% WoW; the inventory of 300-series was 548,700 mt, down 0.82% WoW and 1.81% MoM; the inventory of 400-series was 143,400 mt, up 1.78% WoW and 0.94% MoM.

200-series: Last week, the shipments from southern steel mills were normal, while the shipments from northern steel mills were relatively high. The spot price of 201 stainless steel stopped falling last week, but low-priced resources occasionally flowed out, leading to slow digestion of 200-series inventory. Previous inventory still accumulated significantly, with both cold-rolled and hot-rolled stainless steel inventories in Wuxi increasing. In Wuxi, the cold-rolled stainless steel inventory of 200-series increased by 1.10%, and the hot-rolled stainless steel inventory increased by 1.63%. In Foshan, the arrival of hot-rolled resources was relatively low, with hot-rolled resource inventory decreasing by 2.2%, while cold-rolled resource inventory slightly increased by 0.47%.

300-series: Last week, the spot price of 300-series stainless steel fluctuated downward at the bottom, and the downstream wait-and-see attitude weakened, but only conventional replenishment demand was released, with strong bargaining attitudes. The shipments from Fujian steel mills to Wuxi increased last week, with a slight decrease in cold-rolled stainless steel inventory in Wuxi, down 0.89% WoW, while the supply of hot-rolled plates increased significantly, with hot-rolled inventory up 0.8% WoW. In Foshan, due to the stabilization of prices, downstream purchasing demand was released, leading to good spot digestion, with cold-rolled inventory down 1.79% and hot-rolled inventory down 2.2%. It is worth noting that the significant decrease in 300-series cold-rolled stainless steel inventory last week was mainly due to the decrease in warrant inventory. According to the SMM survey, about 10,000 mt of warrants expired recently and flowed into the market as spot goods but were not counted as new inventory. Therefore, the actual digestion of 300-series cold-rolled stainless steel inventory was relatively weak last week.

400-series: The current demand for 400-series stainless steel is still mainly rigid demand. Last week was the concentrated arrival week for some steel mills' pre-allocated resources, with significant arrivals in both Wuxi and Foshan. The inventory in Wuxi increased by 1.74%, and the overall inventory in Foshan increased by 1.87%.