Spot Prices of Stainless Steel Drop with Weakening Cost Support

SHANGHAI, Apr 11 (SMM) - The weekly drop of spot #304 stainless steel prices was about 500 yuan/mt. Last Friday, a stainless steel mill in south China set a price limit, and the futures prices fell slowly. The spot market saw more pick-up of cargoes without B/L, and the prices rose. Cold-rolled coil inventory in the Foshan market was high previously, thus the prices stood lower than the hot-rolled coils. Last week, the arrivals in Foshan were low, and the demand did not increase, easing the cold-rolled coil supply pressure. And the spread between cold and hot-rolled coils narrowed. In Wuxi, a stainless steel mill in east China shipped a great amount of cold and hot-rolled coil to the market last week, pushing up the overall stainless steel supply. Most market participants still held a wait-and-see sentiment, and some transactions were made to deliver orders. The cold-rolled coil inventory in Wuxi was consumed normally, and the hot-rolled coil inventory dropped slowly. High-grade NPI prices trended lower last week. Stainless steel mills intended to undercut the NPI prices amid the high NPI market supply. Short-term NPI prices will move with some downward potential on the falling prices of nickel ore from the Philippines and Indonesia. Prices of stainless steel experienced a short-term fall last week. SMM believes that the spot prices of stainless steel may be stable with occasional falls this week amid the mismatch between supply and demand and the lower costs.