SHANGHAI, May 21 (SMM) --
Some producers began to halt production in non-mainstream producing regions in Tanxiang of Hunnan province and in Zhenyuan in Guizhou province, but production suspension in mainstream producing regions including Huayan and Xiushan were also reported in the market. Supply of EMM was stable. With regard to cost, prices of ore powder which is main raw material for EMM production was still tight, and grades of ore powder lowered. Therefore prices of ore powder will not slip despite that EMM prices fluctuated at low levels.
Stainless steel mills made purchases on an as-needed basis due to the sluggish market condition. Large steel mills began to invite regular bids, but the impact on the market from the biding was disappointing due to sluggish market condition. Offers on export market slipped slightly, and it still takes time for the recovery of export market.
Producers' reluctance to move goods is expected to grow as current selling prices are near production costs and EMM prices may remain stable at current level as large steel mills will invite regular bids in the following week. However, the fact that EMM producers keep normal production but are unwilling to move goods and the fact that demand from #200 stainless steel market hasn't improved are the biggest negative factors for EMM prices. In this context, EMM prices may be weighed to fall further and may slip below RMB 14,500/mt in the following week, while more and more producers will halt production.
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