SS Futures Strengthened, Stainless Steel Mill Production Cuts Failed to Boost Spot Cargo; Weak Stainless Steel Transactions Persisted [SMM Stainless Steel Daily Report]

SMM October 29 news, SS futures stopped falling and rebounded. Today, nonferrous and ferrous metals futures showed strong performance, and SS futures also stopped falling and followed the upward trend, once climbing above 12,800 yuan/mt during the session. In the spot market, despite the strong performance of SS futures, transaction activity remained sluggish. In addition, a major stainless steel mill announced flat prices for the day, and spot prices remained stable. Market inquiries and purchases were relatively sluggish, and actual transactions still relied on traders offering discounts for sales promotions.

The most-traded SS2512 futures contract stopped falling and rose. At 10:30 am, SS2512 was quoted at 12,755 yuan/mt, up 10 yuan/mt from the previous trading day. In Wuxi, the spot premiums/discounts for 304/2B were in the range of 215-515 yuan/mt. In the spot market, the average price for Wuxi cold-rolled 201/2B coil was 8,000 yuan/mt; for cold-rolled mill edge 304/2B coil, the average price in Wuxi was 12,900 yuan/mt, and in Foshan was 12,900 yuan/mt; for cold-rolled 316L/2B coil in Wuxi, the price was 25,300 yuan/mt, and in Foshan was 25,300 yuan/mt; for hot-rolled 316L/NO.1 coil, both locations reported 24,800 yuan/mt; for cold-rolled 430/2B coil, both Wuxi and Foshan reported 7,600 yuan/mt.

The traditional September-October peak season for stainless steel consumption is nearing its end, and the year-end off-season is approaching. Although the market expects the US Fed to implement two interest rate cuts by year-end, China is in a quantitative easing cycle, and the 15th Five-Year Plan is about to be released, ongoing Sino-US trade frictions and the impending end of the second 90-day tariff grace period keep macro environment uncertainties high. On the spot fundamental side, downstream demand remains cautious with a strong wait-and-see attitude, resulting in weak overall purchasing and transactions. Although the concentrated inventory buildup during the National Day holiday has been partially digested, stainless steel mills' expected production schedule for October remains at a relatively high level, keeping market digestion pressure substantial. Cost side, high-grade NPI prices continued to decline, with traders lacking confidence and selling at low prices to realize cash, further depressing NPI transaction prices. The previous tight supply situation for high-carbon ferrochrome has eased, chrome ore prices have softened, and ferrochrome producers already had good profits. Coupled with weak overall demand-side expectations, both high-carbon ferrochrome and high-grade NPI prices are in the doldrums, leading to a downward shift in the cost center for stainless steel. Under the influence of multiple factors including macro uncertainties, weak demand, high supply, and loosening cost support, the current stainless steel market struggles to break free from its weak pattern. Close attention is still needed on favorable macro policies and stainless steel mills' production schedules.