Stainless steel products and costs edge up in tandem, steel mill profits remain stable [SMM Analysis]

Published: Jul 24, 2026 17:03

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[SMM Analysis] Stainless Steel Products and Costs Edge Up in Tandem, Steel Mill Profits Stable This week, stainless steel product prices and production costs edged up in tandem, while steel mill smelting profits remained basically stable overall. Based on calculations for 304 cold-rolling, the profit margin this week was 2.15% when accounting for raw materials at current prices and 1.11% when accounting for inventory raw materials, indicating that stainless steel mills still maintain certain smelting profits. Nickel-based raw materials side, high-grade NPI prices were largely stable this week. Although SHFE nickel and SS futures held up well overall during the week, the current traditional consumption off-season for stainless steel meant steel mills' purchase demand for NPI remained persistently weak, with very few actual transactions concluded recently. Amid the tug-of-war between longs and shorts, NPI prices remained steady this week. As of this Friday, the delivered duty-paid price for China's 10-12% grade Indonesian high-grade NPI remained stable at 1,132.5 yuan per nickel unit. Stainless steel scrap prices edged up this week, lifted by stronger SS futures driving spot prices higher. However, the temporarily stable high-grade NPI prices narrowed scrap's economic advantage. The current traditional consumption off-season persists, downstream demand is sluggish, and steel mills are cautious in purchasing, mainly transacting on a need-to basis. Under the dual constraints of weak demand and diminishing substitution benefits, upward momentum for stainless steel scrap was insufficient. In the short term, it will maintain largely stable consolidation supported by futures resilience, with limited upside room. As of this Friday, mainstream 304 off-cuts prices in Shanghai rose by 200 yuan/mt, quoted at 10,450 yuan/mt. Chrome-based raw materials side, high-carbon ferrochrome prices operated stably this week. Although ferrochrome supply remains relatively ample currently, coupled with demand pulling back amid off-season production cuts for stainless steel, recent high-cost ferrochrome...

This week, stainless steel product prices rose slightly alongside production costs, leaving steel mills' smelting profit largely stable. Based on 304 cold-rolling calculations, the profit margin was 2.15% using current raw materials and 1.11% using inventory raw materials this week, indicating that stainless steel mills still retained some smelting profit.

On the nickel-based raw material side, high-grade NPI prices were largely stable this week. Although SHFE nickel and SS futures held up well overall, stainless steel remained in the traditional consumption off-season, and mills' purchasing demand for NPI stayed persistently weak, with limited actual transactions recently. Amid the tug-of-war between longs and shorts, NPI prices remained steady this week. As of Friday, the domestic delivered duty-paid price for Indonesian high-grade NPI at 10-12% grade was stable at 1,132.5 yuan per nickel unit.

This week, stainless steel scrap prices edged up, driven by SS futures gains that lifted spot prices. However, the temporary stability of high-grade NPI prices narrowed scrap's economic advantage. With the market still in the traditional consumption off-season, downstream demand was weak, and mills remained cautious in procurement, focusing mainly on need-based transactions. Under the dual constraints of sluggish demand and fading substitution benefits, stainless steel scrap lacked upward momentum and was expected to stay largely stable with limited upside room in the short term, supported by futures resilience. As of Friday, mainstream 304 off-cuts prices in Shanghai rose 200 yuan/mt to 10,450 yuan/mt.

On the chrome-based raw material side, high-carbon ferrochrome prices were stable this week. Although the ferrochrome supply remained relatively ample, and demand pulled back amid stainless steel production cuts during the off-season, the recent arrival of high-cost chrome ore, combined with a market-wide wait-and-see sentiment ahead of steel mill tenders, kept prices steady with no significant movement. On Friday, mainstream stainless steel mills announced their August tender prices for high-carbon ferrochrome, down 200 yuan/mt (50% metal content) MoM, suggesting spot prices would likely gradually converge toward the tender price. As of Friday, mainstream high-carbon ferrochrome prices in Inner Mongolia were flat MoM at 8,075 yuan/mt (50% metal content).

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