Stainless Steel Spot Prices Rose After the New Year, Inventory Accumulation Was Lower Than in Previous Years [SMM Analysis]

This week, stainless steel spot prices showed an overall upward trend. As of February 7, SMM Wuxi region's 304 cold-rolled coil was quoted at 13,050-13,400 yuan/mt, with an average price up 50 yuan/mt WoW; hot-rolled prices were 12,450-12,600 yuan/mt, with an average price up 16.67 yuan/mt WoW.

Supply side, after the Chinese New Year holiday, steel mills gradually resumed production, and operating rates continued to rebound. Among them, a steel mill in South China officially announced the completion of maintenance and resumption of production on February 3. Although market inventory increased during the holiday, the growth rate was narrower compared to previous years. This week, stainless steel social inventory rose 5.93% WoW, with Wuxi region's 200-series, 300-series, and 400-series inventories up 5.61%, 7.57%, and 2.67% WoW, respectively; Foshan region's 200-series and 300-series inventories rose 3.73% and 7.75% WoW, respectively, while 400-series inventory fell 2.07% WoW.

Demand side, the market has not fully recovered after the holiday, with trading sentiment remaining sluggish and downstream demand still at a low level. On the raw material side, NPI and high-carbon ferrochrome prices surged significantly this week, while prices of high-silicon SiMn alloy, EMM, and stainless steel scrap remained stable. The strong performance of raw materials provided significant support for stainless steel prices. It is expected that with increased arrivals next week, inventory will continue to accumulate, but spot prices are likely to remain stable under the support of raw materials.

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