[SMM Stainless Steel Flash] China's Q3 Stainless Steel Market Prepares for Initial Weakness Before Peak Season Recovery

Published: Jul 3, 2026 11:13

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China's stainless steel market faces near-term pressure in Q3 before an anticipated rebound driven by production cuts and seasonal demand recovery. High temperatures and rainfall in July and August typically slow construction activity, dampening inventory depletion in key hubs such as Wuxi and Foshan. To counter shrinking margins, mills initiated maintenance shutdowns, with planned output estimated to decline 4.11% over June-July. By September, the traditional "Golden September, Silver October" peak season combined with equipment upgrade policies should revive terminal procurement. On the macro front, potential US rate hikes and tariff proposals weigh on global metal markets, while domestically, new capacity replacement rules are accelerating the phase-out of obsolete production. With raw material cost support fading, supply-demand fundamentals are set to become the primary market driver.

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