[SMM Analysis] End-Use Demand Remains Moderate, Non-Oriented Silicon Steel Prices Expected to Stay Stable Next Week

[Weekly Overview of the Silicon Steel Market]

Shanghai Market

▶ Price Trends

Mainstream grades of non-oriented silicon steel remained stable: B50A800 was quoted at 5,200 yuan/mt, and 50WW800 at 5,100 yuan/mt, both unchanged WoW.

▶ Market Supply and Demand

Ferrous metals futures fluctuated rangebound, and spot prices followed market trends. Steel mills faced tight inventory for medium- and low-grade resources, while end-user order volumes did not show a significant rebound, with raw material procurement plans postponed to early March.

▶ Transaction Performance

Traders reported an improvement in inquiry volumes WoW, but actual transactions were mainly direct supplies to end-users. Market circulation remained sluggish, and overall transactions were still weak.

▶ Trader Sentiment

Futures market fluctuations did not transmit to the spot market. Traders operated cautiously, generally maintaining stable prices and adopting a wait-and-see approach.

▶ Short-Term Outlook

The weak supply and demand pattern is expected to persist, with prices likely to remain stable next week.

Wuhan Market

▶ Price Trends

Non-oriented silicon steel 50WW800 was quoted at 5,100 yuan/mt, and 50WW600 at 5,250 yuan/mt, both unchanged WoW.

▶ Market Drivers

Baosteel raised its March silicon steel base price by 100 yuan/mt, coupled with tight inventory of WISCO resources, narrowing the room for market price negotiations.

▶ Demand-Side Performance

Orders from downstream processing enterprises were still mainly based on pre-holiday stock, with limited new orders. Silicon steel procurement followed a just-in-time restocking rhythm.

▶ Trader Sentiment

Quotations were tentatively raised, but transaction follow-through was insufficient. Traders held a cautious outlook for the market.

▶ Short-Term Outlook

With cost support and weak demand in a tug-of-war, prices are expected to continue rangebound consolidation.

Guangzhou Market

▶ Price Trends

Baosteel Zhanjiang's B50A800 was quoted at 4,900 yuan/mt, Ansteel's 50AW800 at 4,800 yuan/mt, and Shougang Group's 50SW800 at 4,950 yuan/mt, all unchanged WoW.

▶ Market Characteristics

Futures market fluctuations prompted end-users to restock at lower prices, leading to a slight recovery in transactions WoW. However, structural imbalances emerged:

External Pressure: Export tax rates for home appliances rose to 35%, putting pressure on overseas orders and potentially intensifying domestic trade competition;

Domestic Trade Dynamics: Top-tier enterprises may offer discounts to maintain market share, while raw material price transmission faced resistance.

▶ Short-Term Outlook

With mixed bullish and bearish factors, prices are expected to fluctuate rangebound, with a volatility range of 50-80 yuan/mt.

Regional Market Comparison

Dimension      Shanghai      Wuhan      Guangzhou

Inventory Pressure      Tight for medium- and low-grade      Tight across all WISCO resources      No significant gaps mentioned

Cost Drivers      None   Baosteel price adjustment provides support      Export tariffs impact the industry chain

Demand Expectations      May improve in early March      Remains weak      Domestic trade competition intensifies

Price Elasticity      Low   Medium (cost support)   Medium-High (policy disruptions)

Core Imbalance: The mismatch between steel mills' sentiment to stand firm on quotes and the pace of end-user demand recovery has led the market into a weak equilibrium. It is recommended to monitor March home appliance production schedules and changes in export policies.