The high cost of 304 stainless steel made profitability challenging

SMM March 28 News,

This week (March 24-28, 2025), both the cost and price of 304 stainless steel cold-rolled coil (CRC) showed an upward trend, but the improvement in profit margin was relatively limited.

Cost side, the cost of 304 stainless steel cold-rolled coil (CRC) continued to rise this week. This may be attributed to the increase in raw material prices and adjustments in production costs, which put significant pressure on producers.

Spot side, the price of 304 stainless steel cold-rolled coil increased. Due to the rise in raw material prices, costs provided strong support, and both steel mills and spot traders were optimistic, leading to widespread price adjustments. However, with costs continuing to rise, market prices remained in an inverted state. Given that demand fell short of expectations, downstream companies had low acceptance of high-priced stainless steel products, limiting the transmission of costs downstream.

Profit side, the profit margin of 304 stainless steel cold-rolled coil hovered around -2%, failing to achieve a substantial shift into the profit zone. Mid-week, the profit margin once dropped to -2.4%. Subsequently, thanks to the rise in market prices, the profit margin gradually rebounded. As of March 28, the loss narrowed to -1.5%, and operational pressure eased. However, with costs continuing to fluctuate at highs, the price increase was relatively weak, and the profit space remained unfavorable. The profitability of 304 cold-rolled coil still faces challenges, and it is difficult to reverse the loss trend in the short term. If the imbalance between cost and price cannot be effectively improved in the future, the profitability dilemma of the cold-rolled coil business may persist.

Next week, costs are expected to remain high, and downstream demand is unlikely to improve significantly in the short term. Supported by costs, spot prices are expected to show a steady upward trend, but the increase will be limited, and the profit space will remain unfavorable.

If you have any questions, please feel free to contact Chaoxing Yang at 13585549799 (same as WeChat).

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