Tug-of-war between longs and shorts in the market, with stainless steel spot prices remaining stagnant [SMM Stainless Steel Daily Review]

Published: Jul 7, 2025 17:31

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[SMM Stainless Steel Daily Review: Tug-of-War Between Longs and Shorts in the Market, Stainless Steel Spot Prices Remain Stagnant] SMM reported on July 7 that the SS futures market showed a downward and pullback trend today, with the low point once again dipping below the 12,600 yuan/mt threshold. In the spot market, the situation largely mirrored that of the previous week, with no significant fluctuations in spot prices. However, amid the futures market's jump initially and then pull back, market acceptance of high prices further diminished. To facilitate transactions, traders occasionally offered discounted cargoes at lower prices. Currently, in the off-season for consumption, with prices at a low level, the market remains in a stalemate. Despite steel mills initiating production cuts due to losses, it will still take time to digest the previous market inventory. In the futures market, the most-traded contract 2508 experienced a downward and pullback trend. At 10:30 a.m., SS2508 was quoted at 12,695 yuan/mt, down 55 yuan/mt from the previous trading day. In the Wuxi region, the premiums and discounts for 304/2B spot stainless steel ranged from 125-275 yuan/mt. In the spot market, cold-rolled 201/2B coils were quoted at 7,600 yuan/mt in both Wuxi and Foshan; cold-rolled 304/2B coils with mill edges had an average price of 12,725 yuan/mt in Wuxi and the same in Foshan; cold-rolled 316L/2B coils were priced at 23,600 yuan/mt in Wuxi and the same in Foshan; hot-rolled 316L/NO.1 coils were quoted at 22,900 yuan/mt in both regions; and cold-rolled 430/2B coils were priced at 7,100 yuan/mt in both Wuxi and Foshan. Currently, despite a decline in stainless steel social inventory and a partial recovery in market confidence compared to the previous period, transactions remain sluggish...

SMM July 7 - Stainless steel futures pulled back today, with the low once again testing the 12,600 yuan/mt level. Spot market-wise, conditions largely extended last week's trend without significant price fluctuations. However, against the backdrop of futures initially jumping then pulling back, market acceptance of high prices further declined, with traders occasionally offering discounts on low-priced cargoes to boost transactions. Currently in the consumption off-season with depressed prices, the market remains in a stalemate. Although steel mills have begun production cuts under cost-side losses, it will take time to digest existing inventories.

Futures-wise, the most-traded SS2508 contract declined. At 10:30 am, SS2508 traded at 12,695 yuan/mt, down 55 yuan/mt from the previous session. Wuxi's 304/2B spot premiums/discounts ranged between 125-275 yuan/mt. In spot markets, Wuxi and Foshan's 201/2B cold-rolled coils both traded at 7,600 yuan/mt; 304/2B cold-rolled edge-trimmed coils averaged 12,725 yuan/mt in both cities; Wuxi's 316L/2B cold-rolled coils traded at 23,600 yuan/mt, matching Foshan's price; 316L/NO.1 hot-rolled coils were quoted at 22,900 yuan/mt in both locations; 430/2B cold-rolled coils traded at 7,100 yuan/mt in both cities.

Currently, although stainless steel social inventories declined slightly and market confidence improved compared to earlier periods with marginally better transactions, the sector remains in its traditional off-season without substantial recovery in end-use demand. Presently, transactions remain heavily influenced by futures movements and news flow, with persistently low acceptance of high-priced material keeping stainless steel spot prices at relatively depressed levels.Despite recent pullbacks in social inventories over the past two weeks, overall levels stay elevated, maintaining significant destocking pressure on steel mills' in-plant and forward inventories, which continues delaying the supply-demand rebalancing process.Additionally, under current expectations for mill production cuts, demand for high-grade NPI weakened, keeping nickel pig iron prices depressed and further eroding cost support for stainless steel.

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