Performance of the Spot Market was Moderate, and the SS Contract Fluctuated Widely

SHANGHAI, Jan 16 (SMM) - SS contract fluctuated widely last week. On the macro side, the US CPI declined for six consecutive months and stood at 6.5% in December 2022, which was lower than 7.10% in November 2022. In this scenario, more market players expected that the US Federal Reserve will slow down the pace of interest rate hikes, which boosted the commodity prices. In terms of fundamentals, there were few goods flowing out of the stainless steel mills last week as most downstream enterprises took holidays for CNY holiday and had no restocking demand. Meanwhile, the cost support was firm as the prices of high-grade NPI remained stable in light of the tight spot supply. In January, NPI plants will reduce their production after the stainless steel mills conduct maintenance. But the NPI prices will remain stable until the end of the CNY holiday since the pre-holiday restocking targets of stainless steel mills have basically been completed. The prices of high-carbon ferrochrome rose last week. The logistics services were basically halted amid the approaching Chinese New Year. Coupled with the bullish outlook towards the chrome ore prices, the prices of ferrochrome are expected to remain stable with slight upside potential under the cost support. To sum up, the pace of inventory accumulation slowed down amid the weak fundamentals in the spot market. SMM expects that the spot prices of stainless steel will remain stable while the futures prices will continue to fluctuate widely this week.