Supply Remains High with Stable Prices, Stainless Steel Market Continues to Be Sluggish After Labour Day Holiday [[SMM Stainless Steel Spot Daily Review]]

SMM reported on May 6 that today marked the first trading day after the Labour Day holiday, with SS futures continuing the volatile trend seen earlier, maintaining overall stability. As most traders had just returned from their holidays, market prices largely remained at pre-holiday levels. Despite stainless steel prices being at a low, the market sentiment remained cautious due to the "rush to buy amid continuous price rise and hold back amid price downturn" mindset. Trading activity remained sluggish, showing no signs of significant improvement.

In the futures market, the most-traded contract 2506 fluctuated. At 10:30 a.m., SS2506 was quoted at 12,690 yuan/mt, up 35 yuan/mt from the previous trading day. In the Wuxi region, the spot premiums/discounts for 304/2B stainless steel ranged from 380-580 yuan/mt. In the spot market, the cold-rolled 201/2B coils in Wuxi and Foshan were both quoted at 8,100 yuan/mt. The average price for cold-rolled trimmed 304/2B coils was 13,000 yuan/mt in Wuxi and 13,000 yuan/mt in Foshan. The cold-rolled 316L/2B coils were priced at 23,850 yuan/mt in Wuxi and 23,850 yuan/mt in Foshan. The hot-rolled 316L/NO.1 coils were quoted at 23,050 yuan/mt in both regions. The cold-rolled 430/2B coils were priced at 7,500 yuan/mt in both Wuxi and Foshan.

Currently, the supply side of the stainless steel market continues to fluctuate at highs. To alleviate cost pressure, stainless steel producers are mainly reducing the production of heavily loss-making 300-series stainless steel and increasing the production of 200-series and 400-series stainless steel to adjust their product mix. However, market participants generally reflect that the persistent weakness in downstream consumer demand and cautious procurement behavior have become the core imbalance constraining market development. In the short term, without effective macro policy support, stainless steel prices are expected to remain weak amid the high market supply.