SS Contract will Remain Rangebound this Week

SHANGHAI, Aug 29 (SMM) - Spot prices of stainless steel rose slightly after Tsingshan Group raised the prices of forward goods last week, and so did the SS contract. Warrants inventory decreased last week, constantly creating historical lows. On the supply side, the amount of goods released in the market by steel mills contracted, resulting in a shortage of some spots. On the demand side, the downstream increased the purchases with a slight improvement in transactions. However, the demand could not be transmitted to the terminal end smoothly, and the short-term demand will remain slack. The cost support continued to weaken. The retail prices of high-carbon ferrochrome fell last week, and the ferrochrome plants still suffered losses even though the bid prices were higher than expected. Meanwhile, the demand remained weak, thus the short-term prices may continue to decline. NPI prices dropped slightly. The NPI plants were still suffering losses though the costs fell. And the situation of oversupply did not change. It is expected that NPI prices will fall in the short term. The prices of stainless steel scrap rose slightly, and its cost efficiency further improved. In general, the supply and demand of stainless steel remained weak last week, and the cost support slightly weakened. SMM believes that the prices of the SS contract will remain rangebound this week.