[SMM Analysis] Stainless Steel Inventory Stops Rising and Begins to Decline as Export License Policy Approaches

SMM December 18 - This week (December 12-18, 2025), the total inventory of the two major stainless steel markets in Wuxi and Foshan stopped rising and pulled back, increasing from 947,600 mt on December 11, 2025 to 926,700 mt on December 18, down 2.21% WoW.

This week, social inventory of stainless steel stopped rising and showed a pullback. Although SS futures fell sharply due to macro factors, market confidence was insufficient with a strong wait-and-see sentiment, leading to low buying activity during the week; traders offered discounts to promote shipments, and spot prices moved down in sync, further reinforcing the market mentality to "rush to buy amid continuous price rise and hold back amid price downturn." However, on the other hand, arrivals at stainless steel mills were relatively low during the week, and agents had notified traders to pick up goods; coupled with recent export policy adjustments that reincluded stainless steel products under export license management, effective January 1, 2026, export enterprises are rushing processing and cargo pick-up to complete operations before the policy window closes, accelerating the pace of existing inventory destocking. Nevertheless, amid the year-end off-season, weak downstream demand is a given, and the short-term destocking driven by arrival pace and the policy window may be difficult to sustain. Follow-up attention is still needed on the actual implementation of stainless steel mills' production cut plans.