The situation of strong supply and weak demand still exists in January, with limited room for upward price correction [SMM Analysis].

 In December 2024, stainless steel prices overall fluctuated downward and remained stable. The average monthly price of 304 cold-rolled coils in Wuxi was 13,161 yuan/mt, down approximately 372 yuan/mt MoM. Supply side, stainless steel mills in east China slightly increased production in December, but the overall change was relatively small. Shipments remained normal, and the overall market supply was relatively ample. Demand side, December was mostly at the off-season winter level, with downstream demand for stainless steel remaining weak and poor sales performance, leading to an overall market oversupply. Raw material side, upstream high-carbon ferrochrome, NPI, and stainless steel scrap continued to decline, providing insufficient cost support. However, due to the significant and continuous drop in 304 stainless steel finished product prices, the profit margin for 304 remained inverted. In summary, the supply-demand mismatch in the stainless steel market further deepened, and cost support collapsed, resulting in an overall downward trend.

  Entering January 2025, due to the excessive decline in the previous period, 304 stainless steel prices further dropped with a "double dip," reaching a four-year low. Downstream demand remained at a low level, and market sentiment was sluggish. However, stainless steel mills slightly reduced their production schedules, with the total output of the 300-series in January expected to reach approximately 1.619 million mt. The supply-demand imbalance is expected to persist in January, with limited room for price recovery, and the overall trend is likely to remain weak.