[SMM Analysis] High-Grade NPI Prices Rise Significantly Amid Dual Support from Supply and Demand and Firm Cost Line

The average price of SMM 10-12% high-grade NPI increased WoW by 9.6 yuan/mtu to 937.1 yuan/mtu (ex-factory, tax included), while the Indonesian NPI FOB index price rose WoW by 1.64 $/mtu to 114.84 $/mtu.

Multiple stainless steel mills and upstream suppliers successively launched tenders this week, with market activity significantly increasing. Supply side, core production costs such as auxiliary materials and electricity prices continued to rise. High-grade NPI prices rose notably this week, improving smelter profit margins to some extent. However, with costs persistently increasing while high-grade NPI prices saw limited short-term gains, smelters are still expected to struggle reversing the inverted price-cost situation. The firm cost line provided solid bottom support for high-grade NPI prices.

Demand side, market activity significantly improved this week, with actual trading volume increasing, driving up high-grade NPI prices. Meanwhile, continuous destocking of stainless steel inventory and gradual consumption recovery further boosted confidence in the high-grade NPI market.

Overall, the high-grade NPI market this week gained strong support and achieved price increases due to the dual effects of firm cost-side breakeven levels on the supply side and improved activity on the demand side. Looking ahead to next week, with cost support expected to persist and the recovery trend in downstream stainless steel demand likely to continue, high-grade NPI prices are projected to maintain stable operation.