Home / Metal News / 不锈钢 / [SMM analysis] stainless steel futures prices rose six times in a row, consumption is still in a weak market, it is difficult to rise again.
[SMM analysis] stainless steel futures prices rose six times in a row, consumption is still in a weak market, it is difficult to rise again.
Apr 14,2020 16:18CST
translation
Source:SMM
The content below was translated by Tencent automatically for reference.

SMM4, April 14: since April 7, stainless steel futures continued to rise, as of April 14, stainless steel main contract SS2006 closed at 12805 yuan / ton, a one-day increase of nearly 1.8%, intraday rose to 12840 yuan / ton, the highest since March 3, compared with the closing price of 12050 yuan / ton, up 790 yuan / ton, an increase of 6.15%.

On the spot side, the market price of 304 stainless steel in Wuxi has risen slightly recently, mainly due to the increase in the new opening price after the closure of the steel plant, and the superimposed futures contract price is still a strengthening trend. Some traders said that some businesses have a small amount of existing inventory, but some orders have been checked out, and after the price has been raised, the replenishment of the stock has been carried out. Therefore, the current situation of receiving orders is still OK, but whether the subsequent price strength can be sustained or not depends on the downstream demand. A short-term price adjustment at present or in a lower position. Foshan area with the market mainstream steel mills to rise prices, promote the market steel price rising atmosphere enhanced, Foshan area traders said that although there are replenishment, but the downstream demand is still not particularly optimistic, terminal actual procurement is still bargaining.

On the inventory side, stainless steel inventory growth has slowed since March, with 300 series stainless steel stocks falling slightly. According to SMM data, stainless steel social inventory at the end of March was slightly lower than in mid-March. Stocks in Foshan and Wuxi were about 1.123 million tons, down 61000 tons from mid-March and 5.18 per cent from the previous month. On the one hand, the decline in inventory is mainly due to the price reduction of traders in March and the consumption of inventory; on the other hand, due to the large reduction in production of steel mills in February, the arrival of goods in March has decreased to a certain extent, superimposed on the certain consumption of social inventory by centralized procurement in the lower reaches of early March, resulting in a small decline in the social bank in March. However, with the gradual recovery of steel production and the non-continuous improvement in downstream demand, stainless steel stocks are expected to increase slightly in April.

In terms of output, since mid-March, the rework rate of industrial enterprises above the national scale has increased rapidly, and the rework rate of other provinces (autonomous regions and municipalities) in the country has exceeded 90%. Among them, Zhejiang, Jiangsu, Shanghai, Shandong, Guangxi, Chongqing and so on have been close to 100%. According to SMM, the output of stainless steel plants in March rebounded from February, totaling 2.04 million tons, an increase of 13.4 percent over the same period last year, but still decreased from the same period last year, down 12.98 percent from the same period last year. With the control of the epidemic, the output of steel mills has gradually returned to normal, with stainless steel production expected to be about 2.27 million tons in April, an increase of 11.5 percent over March.

At present, the price of stainless steel futures contracts has risen continuously, or the market has slightly revised the decline in the previous period. On the one hand, it is expected that the supply and demand side will be improved to a certain extent in the later stage; on the other hand, nickel ore is prohibited from transportation, and the price of nickel and iron and stainless steel scrap has gone up, pulling up the cost and strengthening the price of stainless steel. The spot market for stainless steel is also following the price increase under the influence of the sealing of various steel mills. But now the supply is still in a loose state, the foreign epidemic situation is in the outbreak period, stainless steel coil and metal products and other foreign export demand is limited, part of the export volume will be released in the domestic market, so the stainless steel walking strong situation or difficult to continue for a long time, the later stage may be in the new price shock range.

2020 China International stainless Steel Industry Market and Application Development Forum

Scan QR codes, apply to attend the meeting or join the SMM Metal AC Group

 

Stainless steel
nickel
steel
production capacity

For queries, please contact Frank LIU at liuxiaolei@smm.cn

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

Related news