Stainless Steel Prices To Fluctuate Downward

Stainless steel contracts saw a minor increase followed by a pullback. As of October 19, the closing price of stainless steel contracts decreased slightly from October 12. On the macro front, both the member of the Federal Reserve Board of Governors Woller and permanent FOMC voter Williams expressed support for maintaining restrictive interest rates. Whether to continue raising rates depends on data. Considering the statements of several officials, it is expected that interest rates will remain high. Stainless steel prices will be under pressure. On the supply side, the delivery in Wuxi and Foshan decreased compared to the week ending October 13. Domestic steel mills announced production cuts. The circulating spot supply is somewhat tight. On the demand side, there was a slight destocking in Wuxi and Foshan, with a decrease of 1.21% compared to the week ending October 13. In Wuxi, there was a 3.07% reduction in the stock of 300 series compared to the week ending October 13. This is mainly because many South China steel mills have urged agents to take delivery. Agent prices adjusted flexibly last week. At the same time, as the end of the month approaches, traders have a stronger motivation to sell for cash flow. However, transactions are still mainly driven by actual demand, and the pace of downstream pickups has slowed down. High-grade NPI prices fell continuously. The expected boom in the stainless steel market during September and October, known as "Golden September and Silver October," hasn't materialized. Domestic stainless steel manufacturers have announced production cuts. As the demand was weak, NPI plants have a stronger willingness to deliver, resulting in consecutive price cuts. It is expected that high-grade NPI prices will be weak in the short term. High-carbon ferrochrome prices remained stable. The transaction in the ferrochrome market was lackluster, with weak expectations for future demand. The amount of chrome ore arriving at domestic ports is expected to significantly decrease in the current month. It is expected that high-carbon ferrochrome prices will remain stable in the short term. Currently, stainless steel costs are weakening while stainless steel market is in a state of weak supply and demand. SMM predicts that stainless steel prices will fluctuate downward this week.