Stainless Steel Scrap Weakens in Tandem with Entire Industry Chain Downturn, Prices Hit Three-Year Low with Limited Downside Expected [SMM Stainless Steel Scrap Market Weekly Review]

This week, the price of 304 stainless steel scrap off-cuts in east China pulled back, reaching 9,100-9,200 yuan/mt; in Foshan, the price of 304 stainless steel scrap off-cuts held steady, at 8,850-9,150 yuan/mt. Currently, calculated by raw material, the production cost of stainless steel using entirely stainless steel scrap was approximately 12,825 yuan/mt, while the cost using entirely high-grade NPI was about 13,110.84 yuan/mt. This week, a steel mill in south China did not adjust its tax-included procurement price for 304 stainless steel scrap.

This week, transactions of stainless steel finished products remained sluggish, SS futures continued to grind lower, and stainless steel spot prices were also in the doldrums. Against the backdrop of steel mills facing inverted margins and expectations of production cut plans, their desire to bargain down prices for raw materials was quite strong, leading to synchronous pullbacks in the prices of high-grade NPI and high-carbon ferrochrome. In the overall weak market environment, stainless steel scrap prices struggled to diverge from the trend and also moved lower. However, the economic advantage of stainless steel scrap compared to high-grade NPI remains significant. Additionally, recent issues with tax invoices have eased somewhat, and current stainless steel scrap prices are at a nearly three-year low, providing some support to the stainless steel scrap market. Although it is expected that stainless steel scrap prices will find it difficult to reverse the weak trend in the overall soft market, the extent of any further decline is anticipated to be limited.