"September-October Peak Season" Consumption Weakness, Stainless Steel Scrap Prices Follow Finished Products Downward [SMM Stainless Steel Scrap Market Weekly Review]

This week, the price of 304 stainless steel scrap off-cuts in east China dropped slightly to 9,650-9,750 yuan/mt; in Foshan, the price of 304 stainless steel scrap off-cuts dropped slightly to 9,350-9,650 yuan/mt. Currently, calculated by raw material, the production cost of stainless steel using entirely stainless steel scrap is approximately 13,476.32 yuan/mt, while the cost using entirely high-grade NPI is approximately 13,688.92 yuan/mt. This week, a steel mill in south China has not adjusted its tender price for stainless steel scrap procurement.

This week, stainless steel finished product prices pulled back, raw material-side NPI prices showed signs of softening, and the upward momentum of high-carbon ferrochrome prices was difficult to sustain, leading to a slight drop in stainless steel scrap prices during the week. Although it is still the traditional September-October peak season for consumption, downstream stainless steel consumption recovery has been limited, and transactions have been weak. In addition, the macro tailwinds that previously boosted the market have been temporarily exhausted, market confidence is insufficient, resulting in losses for stainless steel mills, weak willingness to increase production, and a cautious attitude toward raw material procurement. Although the economic advantage of stainless steel scrap has become more prominent compared to NPI, against the backdrop of an overall weakening market, there is generally a lack of bullish expectations. Currently, constrained by limited consumption recovery and fading macro tailwinds, the stainless steel industry chain is fluctuating downward overall, with mills controlling production cautiously and adopting a conservative approach to raw material procurement.