Synchronized Strengthening of Stainless Steel Supply and Demand, Social Inventory Dropped Slightly by 0.27% [SMM Analysis]

As of October 18, SMM total social inventory of stainless steel was 988,000 mt, down approximately 0.27% WoW. Among them, the inventory of 200-series stainless steel was 284,400 mt, down approximately 0.75% WoW; the social inventory of 300-series stainless steel was about 565,300 mt, up approximately 0.48% WoW; the social inventory of 400-series stainless steel was about 138,300 mt, down approximately 2.3% WoW.

200-series: Currently, shipments of 200-series stainless steel are relatively normal, spot prices are generally stable, sales are moderate, and the effect of production cuts at stainless steel mills is evident. In Wuxi, the overall inventory dropped by 1.34%, while in Foshan, there was an inventory buildup in hot-rolled products, with an overall inventory drop of 0.37%.

300-series: After the holiday, stainless steel mills maintained high shipments, but at the beginning of the week, stainless steel futures rose, and downstream purchasing demand was released in October. Supply and demand strengthened simultaneously, with a slight inventory buildup in both cold-rolled and hot-rolled products in Wuxi, with a total increase of 0.67%. In Foshan, hot-rolled products were well digested, and the shipments of hot-rolled products from steel mills in Jiangsu were relatively low, resulting in a slight inventory buildup of 0.22%.

400-series: Recently, although the prices of 400-series stainless steel dropped slightly compared to before the holiday, transactions were good last week, coupled with fewer shipments from steel mills, leading to a significant inventory reduction. In Wuxi, the inventory dropped by 1.69%, and in Foshan, it dropped by 3.65%.

In summary, the current production schedule of stainless steel remains high, supply tends to be ample, but downstream demand has slightly warmed up compared to before. In the short term, the probability of synchronized strengthening of supply and demand is high, and it is expected that the social inventory of stainless steel will slowly decrease.