Cost Advantages Keep Stainless Steel Scrap Steady, but Weak Off-Season Demand Caps Upside Room [SMM Stainless Steel Scrap Weekly Review]

Published: Aug 7, 2026 14:57

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[SMM Stainless Steel Scrap Weekly Review] Cost Advantages Underpin Stainless Steel Scrap Holding Steady; Weak Off-Season Demand Caps Upside Room This week, the price of 304 stainless steel scrap off-cuts in east China remained unchanged, with a quotation range of 10,400-10,500 yuan/mt; prices in Foshan pulled back slightly, within a range of 10,200-10,500 yuan/mt. An analysis of raw material production costs shows that the cost of producing stainless steel using only stainless steel scrap is about 14,607.48 yuan/mt, while using only high-grade NPI reaches 14,968.22 yuan/mt, with the two maintaining a stable cost spread. Stainless steel scrap prices were broadly stable this week. Indonesian news disrupted market sentiment during the week, and SS futures swung wildly. The futures fluctuations transmitted to the spot market, driving concurrent swings in spot stainless steel products, but overall prices only pulled back slightly, highlighting the resilience of spot prices. The price of the alternative raw material high-grade NPI continued to consolidate on a strong note, and the overall tone on the raw material side was relatively steady. Caught in a tug-of-war between bullish and bearish factors, stainless steel scrap prices remained stable during the week. Overall, cost advantages and production resumption expectations provided support, but end-user off-season fundamentals continued to suppress price increases. The market is still in the traditional stainless steel consumption off-season, and downstream end-user demand for finished steel products is generally weak, leaving the market without a sustained upward driver from end-user demand. Although the market expects stainless steel production schedules to improve in August, which may lift rigid demand for stainless steel scrap, and the current economic advantages of stainless steel scrap remain in place, providing potential bullish support for the market…

This week, prices of 304 stainless steel scrap off-cuts in east China remained flat, with a quotation range of 10,400-10,500 yuan/mt; in Foshan, prices pulled back slightly, with a price range of 10,200-10,500 yuan/mt. Analysis of production costs from the raw material side shows that currently, the cost of producing stainless steel entirely using stainless steel scrap was approximately 14,607.48 yuan/mt, while the cost using only high-grade NPI reached 14,968.22 yuan/mt, with the two maintaining a stable cost spread.

This week, stainless steel scrap prices remained stable overall. During the week, Indonesia-related news disrupted market sentiment. SS futures exhibited wild swings, and the fluctuations spilled over into the spot market, causing spot stainless steel products to fluctuate in sync. However, overall prices only pulled back slightly, highlighting the resilience of spot cargo. Prices of the alternative raw material, high-grade NPI, continued to consolidate on a strong note. The overall atmosphere on the raw material side was stable. Amid the tug-of-war between bullish and bearish factors, stainless steel scrap prices remained stable during the week. Overall, cost advantages and expectations of production resumptions provided support, but the fundamentals of the end-user off-season continued to suppress market uptrend. The market remained in the traditional consumption off-season for stainless steel. Downstream end-user demand for finished products was generally weak, and the market lacked sustained upward momentum from the end-user side. Although market expectations indicated an improvement in August stainless steel production schedules, suggesting better prospects for stainless steel scrap rigid demand, combined with the sustained economic advantages of stainless steel scrap, providing potential bullish support, stainless steel prices themselves lacked upward momentum. Steel mill profit margins were limited, leading to a strong desire to push for lower prices in raw material purchases, which restricted the bargaining room on the raw material side. In summary, in the short term, stainless steel scrap prices are expected to maintain a stable consolidation pattern supported by cost advantages and production resumption expectations, with limited overall upside room.

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

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