Positive news supports the overall market strength, driving stainless steel scrap's economic advantage to narrow, with upward momentum potentially constrained. [SMM Stainless Steel Scrap Market Weekly Review]

This week, the price of 304 stainless steel scrap off-cuts in east China held steady at 9,200-9,300 yuan/mt, while in Foshan, the price of 304 stainless steel scrap off-cuts rose slightly to 9,050-9,350 yuan/mt. Currently, calculated by raw material, the production cost of stainless steel using entirely stainless steel scrap is approximately 12,943.42 yuan/mt, and using entirely high-grade NPI is approximately 13,124.76 yuan/mt. This week, a steel mill in south China did not adjust the tax-included procurement price for 304 stainless steel scrap.

This week, driven by news, stainless steel futures strengthened, leading to an increase in the price of stainless steel finished products. Simultaneously, the price of high-grade NPI on the raw material side rose significantly, while high-carbon ferrochrome saw limited declines, and the price of stainless steel scrap also strengthened. Although stainless steel mills still have production cut plans, recent price increases have helped restore enterprise cost profits, and the implementation of production cuts fell short of expectations. Additionally, although the economic advantage of stainless steel scrap relative to high-grade NPI has narrowed compared to earlier periods, it remains advantageous. Moreover, with the approach of year-end winter stockpiling, market demand for stainless steel scrap remains strong. However, the strength in the stainless steel market driven by favorable news may be difficult to sustain. Coupled with the fact that downstream end-user demand for stainless steel is unlikely to see a significant recovery during the year-end off-season, and stainless steel production cut plans are still advancing, the upward momentum for stainless steel scrap prices may be limited.