Economic Advantage of Stainless Steel Scrap Diminishes, Price Increase May Be Hindered [SMM Weekly Review of Stainless Steel Scrap Market]

Published: May 9, 2025 17:28

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This week, the price of 304 stainless steel scrap off-cuts in east China remained stable, reaching 9,700-9,800 yuan/mt; in Foshan, the price of 304 stainless steel scrap off-cuts also held steady, reaching 9,450-9,750 yuan/mt. Currently, when calculated by raw material, the production cost of stainless steel produced entirely from stainless steel scrap is approximately 13,535.53 yuan/mt, while the production cost of stainless steel produced entirely from high-grade NPI is approximately 13,464.12 yuan/mt. This week, a steel mill in south China did not update its procurement price for stainless steel scrap.

This week, the stainless steel raw material market showed a significant divergence: prices of high-grade NPI and high-carbon ferrochrome continued to decline, while the price of stainless steel scrap followed the slight increase in stainless steel finished product prices. Earlier, driven by cost advantages, the purchasing enthusiasm in the stainless steel scrap market was high, leading to tight supply during the week, with some traders standing firm on quotes and reluctant to sell. Meanwhile, the strengthening of stainless steel finished product prices also provided support for stainless steel scrap prices, pushing them to hold up well. However, with the significant drop in high-grade NPI prices this week, the cost advantage of stainless steel scrap over high-grade NPI has largely disappeared.

Currently, the end-use consumption market for stainless steel remains sluggish. Against the backdrop of increasing uncertainty in the macroeconomic environment, there are doubts about whether the upward trend in stainless steel finished product prices can continue. Coupled with the loss of cost advantages for stainless steel scrap, it is expected that further price increases for stainless steel scrap will face resistance.

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