Stainless Steel Production Schedule Is Expected to Decline, Stainless Steel Scrap Prices Fluctuate Downward [SMM Analysis]

As of this Thursday, the price of 304 stainless steel scrap off-cuts in east China dropped slightly to 9,400-9,500 yuan/mt, while in Foshan, the price declined to 9,400-9,700 yuan/mt. Currently, by raw material calculation, the production cost of stainless steel entirely using stainless steel scrap is approximately 13,180.26 yuan/mt, while the cost using only high-grade NPI is about 13,116.82 yuan/mt. This week, a steel mill in south China did not update its stainless steel scrap procurement prices. Stainless steel finished products and high-grade NPI prices continued to decline this week, leading to a slight adjustment in stainless steel scrap prices. Against the backdrop of continuously falling raw material prices recently, the profit margins of stainless steel mills have somewhat recovered, reducing the need to further suppress raw material prices. However, several stainless steel mills have recently announced annual maintenance and production cut plans, and stainless steel production in January is expected to decline significantly, thereby lowering the demand for raw materials. Compared to high-grade NPI, the current economic efficiency of stainless steel scrap remains relatively low, and stainless steel scrap prices are expected to remain sluggish in the short term.