Spot Stainless Steel Prices Stabilise Temporarily

SHANGHAI, Feb 20 (SMM) - Spot prices of #304 stainless steel were stable with occasional falls last week. On the supply side, a stainless steel mill intentionally cut its spot shipments to the market to ease the supply surplus. On the demand side, most processing plants resumed normal production and became more active in restocking. NPI sellers cut their quotes last week, and panic filled the market. Meanwhile, the low purchase prices offered by stainless steel mills cast a huge pressure on NPI plants. The short-term NPI prices will probably fall. High-carbon ferrochrome prices fell somewhat last week. Recently, chrome ore inventory at ports has remained low. Many ferrochrome plants in south China still suffered losses from their spot raw materials. SMM believes that the short-term ferrochrome prices will be firmly supported by the unresolved supply tightness of ferrochrome and chrome ore.  To sum up, the short-term mismatch between supply and demand has eased, but the downstream demand has not yet substantially increased. It is slightly difficult for the downstream companies to consume the high inventory. SMM believes that the prices of stainless steel will be stable with possible declines this week.