Slow Post-Holiday Resumption, Stainless Steel Scrap Market Faces Tight Supply and Rising Prices [SMM Analysis]

This week, the price of 304 stainless steel scrap off-cuts in east China remained stable at 9,250-9,350 yuan/mt, while in Foshan, the price also stayed flat at 9,300-9,600 yuan/mt. Currently, by raw material calculation, the production cost of stainless steel entirely using stainless steel scrap is approximately 13,002.63 yuan/mt, while the cost using only high-grade NPI is about 13,218.61 yuan/mt. This week, the tax-inclusive purchase price of 304 molten steel from stainless steel scrap at a steel mill in south China was 9,800 yuan/mt, up by 100 yuan/mt from the previous price, while the tax-inclusive purchase price of 316 molten steel was 18,400 yuan/mt. Although the Chinese New Year holiday has ended, a large number of stainless steel scrap traders and stainless steel processing plants have not yet resumed operations this week, resulting in a lack of active market transactions. However, driven by stainless steel futures, the spot price of stainless steel finished products has risen, and high-grade NPI, high-carbon ferrochrome, and ferromolybdenum have also strengthened after the holiday, marking a positive start to the post-holiday market. In January, the production cuts by stainless steel mills were less than expected, keeping the demand for raw materials at a high level. Currently, the supply of stainless steel scrap remains tight and continues to maintain its economic advantage over high-grade NPI. As the market gradually resumes operations, stainless steel scrap prices are expected to rise.