Stainless steel scrap prices pull back, and economic advantages reappear [SMM Weekly Review of Stainless Steel Scrap Market]

This week, the price of 304 stainless steel scrap off-cuts in east China pulled back, reaching 9,300-9,400 yuan/mt; in Foshan, the price of 304 stainless steel scrap off-cuts was largely stable, reaching 9,250-9,550 yuan/mt. Currently, calculating by raw material, the production cost of stainless steel produced entirely from stainless steel scrap is approximately 13,061.84 yuan/mt, while the production cost of stainless steel produced entirely from high-grade NPI is approximately 13,076.06 yuan/mt. This week, a steel mill in south China did not update its purchase price for stainless steel scrap.

This week, influenced by news of production cuts at domestic stainless steel mills, the price of finished stainless steel products first fell and then rose, with market expectations for raw material demand subsequently declining. Despite the stable tender price of high-carbon ferrochrome, the price of high-grade NPI remained weak, and the price of stainless steel scrap also declined simultaneously. Currently, the supply of stainless steel scrap remains relatively tight, with a certain sentiment of refusing to budge on prices and reluctance to sell in the market. However, given the recent cost-price inversion and increased expectations for production cuts at stainless steel mills, the demand for raw material purchases has weakened, leading to an increasingly intense tug-of-war between longs and shorts in the market. Compared to high-grade NPI, the economic advantage of stainless steel scrap has once again become prominent, but due to the simultaneous weakening of prices, the gap between the two is relatively small. Overall, against the backdrop of the current traditional consumption off-season for stainless steel and expectations for production cuts, the price of stainless steel scrap has fallen to a relatively low level, and the market supply is not abundant. Although the market remains weak in the short term, the scope for further declines is somewhat constrained.