SMM April 16 reported that SS futures continued to hold up well. News related to Indonesian nickel ore continued to boost market sentiment, driving SS futures to maintain a fluctuating trend on the strong side. As of the midday close, the most-traded SS contract was quoted at 14,810 yuan/mt. Spot market side, SS futures largely held at high levels. Although end-user clients showed lackluster actual order transactions and remained cautious about purchasing high-priced cargoes, some basis trading orders were actively transacted. Combined with some traders offering discounts on specific specifications to facilitate shipments, the market was confident about the outlook and broadly bullish, with stainless steel prices expected to remain firm in the near term.
The most-traded SS futures contract strengthened and rose. At 10:15 AM, SS2605 was quoted at 14,798 yuan/mt, down 20 yuan/mt from the previous trading day. Spot premiums for 304/2B in the Wuxi area ranged from 30-230 yuan/mt. In the spot market, the average price of cold-rolled 201/2B coils in Wuxi held steady; for cold-rolled untrimmed 304/2B coils, the average price in both Wuxi and Foshan held steady; cold-rolled 316L/2B coils in Wuxi held steady; hot-rolled 316L/NO.1 coils in Wuxi rose by 100 yuan/mt; cold-rolled 430/2B coils in both Wuxi and Foshan held steady.
The stainless steel market was currently in the traditional peak season of "Golden March and Silver April." In the short term, macro tailwinds helped restore confidence, and spot inquiry activity picked up. However, cautious sentiment among end-users persisted, with purchases driven mainly by rigid demand. Acceptance of high-priced cargoes remained poor, and transactions relied on low-priced resources, with no significant volume increase overall. Futures side, US-Iran tensions eased this week as both sides reached a two-week ceasefire agreement and initiated negotiations. Macro tailwinds supported SS futures and market sentiment improved somewhat. However, geopolitical risks had not been fully eliminated, and coupled with intensifying US inflation and discussions of rate hikes from the US Fed, market fluctuation risks increased. Futures struggled to sustain their rise, providing limited support to the spot market. Supply and inventory side, steel mill production schedules for April stayed high, and supply pressure remained unrelieved. Thanks to restored confidence, active inquiries, and the end of concentrated month-end cargo allocation in the prior period, social inventory pulled back slightly this week to 978,700 mt, down 0.55% WoW. However, under the backdrop of high supply, inventory destocking remained under pressure, and steel mill shipments faced challenges. Cost side, high-grade NPI had price support due to losses, but steel mills faced significant cost pressure with low willingness to purchase, keeping high-grade NPI prices subdued. Stainless steel scrap and high-carbon ferrochrome prices held steady. Stainless steel mills overall remained on the edge of breakeven, with the tug-of-war between upstream and downstream continuing. Overall, the core market contradiction this week lay in the interplay of macro uncertainties, high supply, and cautious demand. Although the peak season provided some support and the cost side formed a floor, it was difficult to drive prices higher. Combined with ongoing macro disturbances and persistent downstream wait-and-see attitudes, the market was expected to maintain a relatively stable trend in the near term. Going forward, attention should be paid to the progress of US-Iran negotiations, US Fed policy direction, and the actual release of downstream demand.
![[SMM Analysis] Indonesian Nickel Ore Drives Futures Higher, Stainless Steel Inventory Continues Mild Destocking](https://imgqn.smm.cn/usercenter/TdoSs20251217171724.jpeg)
