China Sees Cuts in Stainless Steel Production after Latest Environmental Drive, SMM Reports

Published: Dec 12, 2016 11:17

Save

What’s impact on domestic producers in the nickel industry from the latest environmental protection inspections?

SHANGHAI, Dec. 12 (SMM) –What’s impact on domestic producers in the nickel industry from the latest environmental protection inspections?

The second round of 7 environmental protection inspection teams arrived in seven regions from November 24 to 30 to supervise environmental protection work, including Beijing, Shanghai, Guangdong, Hubei, Chongqing, Shaanxi and Gansu.

Will New Environmental Protection Inspections Trigger Massive Cuts in China Metals Producers? SMM Reports

SMM learns that Jiangsu Delong Nickel Industry has suspended stainless steel production again due to environmental protection inspections, but maintains high-grade NPI production at present, but the production is going to be suspended.

In November, the company produced 130,000 tonnes of stainless steel, all #300 stainless steel, counting for 12 per cent of China’s total output of the type product. The company needs to purchase 20,000-30,000 tonnes of high-grade NPI each month for its stainless steel production in addition to its own high-grade NPI production. In November, the company also produced around 70,000 tonnes of high-grade NPI.

The suspension of stainless steel production at the company means that demand for high-grade NPI will fall by 20,000-30,000 tonnes, accounting for 6-9 per cent of China’s total output.

Baosteel Group Hikes Steel Prices for January

Moreover, China’s high-grade NPI output will fall in December with output declines at producers in north China due to colder weather and possible cuts at Jiangsu Delong, but any declines will be small.

Hence, stainless steel suspension at Jiangsu Delong will negatively affect high-grade NPI demand in China’s market in December and months ahead.
In other news, stainless steel production at Linyi Jinhaihui Technology is now online, and there is high possibility for the company’s stainless steel production to be suspended. SMM will watch closely to progress of the event.

For news cooperation, please contact us by email: sallyzhang@smm.cn orservice.en@smm.cn.

environmental protection inspections china base metal market environmental drive

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or to learn more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

11 hours ago

Nickel Prices Rise Amid Cost Pressures, Stainless Steel Demand Subdued

[SMM Nickel Flash] March 4 news: Supply side, nickel ore and auxiliary material prices continued to rise, upstream cost pressure gradually increased, and quotes remained firm. Demand side, steel scrap currently has a clear cost advantage, stainless steel selling prices were flat, and under losses pressure, purchasing sentiment was relatively subdued.

11 hours ago

SMM High-Grade NPI Sentiment Rises in March, Upstream and Downstream Factors Improve

[SMM High-Grade NPI] News on March 4: The SMM high-grade NPI market sentiment factor was 2.09, up 0.02 MoM; the high-grade NPI upstream sentiment factor was 2.87, up 0.01 MoM; and the high-grade NPI downstream sentiment factor was 1.32, up 0.03 MoM.

11 hours ago

12 hours ago

[SMM Stainless Steel Flash] Indonesian Major Mill Hikes 316L Export Price by $100/t

According to SMM, on March 4, an Indonesian major stainless steel mill raised its 316L export quotation by USD 100/mt, pushing the price spread between 316L and 304 to USD 1,800/mt. This sharp increase is driven by a rallying molybdenum market: while domestic mines have begun concentrated shipments, molybdenum concentrate transaction prices continue to trend upward. The entire industry chain currently exhibits firm raw material prices and cost-driven pressure, with downstream demand gradually following suit. Strong cost support from the ferromolybdenum market has led to this significant price divergence.

12 hours ago