Stainless Steel Operation Amid Steel Mill Production Cuts

📈 In terms of pricing, the recent scrap stainless steel prices have been mainly stable. As of June 28th, the price of 304 industrial material in Wenzhou area was 9,600 yuan/ton, with the steel water price remaining unchanged for nearly half a month. During the plum rain season in Jiangsu and Zhejiang regions, the market circulation resources were relatively tight, and the atmosphere of price support has rebounded. At the end of the month, some steel mills' purchase prices slightly rose, but the actual transaction volume was limited.

Inventory Aspect

📊 As shown in the figure, the speed of finished materials leaving the warehouse has accelerated. This week, the total social inventory of stainless steel in the 89 warehouses of the national mainstream market was 1.087063 million tons, a decrease of 4.13% compared to the previous week. The social inventory shows a reduction, and each category has been digested to varying degrees. Stainless steel futures fluctuated around 14,000, coupled with the end of the month agency rush to volume with some concessions, the finished products showed a slight increase in price. The Jiangsu and Zhejiang market is currently in the plum rain season, and at the end of the month, merchants are urging to issue invoices, and weak demand is an undeniable fact. The acceleration of stainless steel inventory reduction is mainly due to the recent reduction in steel mill arrivals, coupled with the market's rigid demand for purchases, and some digestion of low-priced resources. The transaction situation in the previous two weeks showed a slight increase, and the delayed delivery also brought delayed warehouse data.

Economic Aspect

📉 Since June, the overall impact of macro factors on the nickel iron market has dissipated, coupled with the pressure of terminal demand transmission, the price has been under pressure and adjusted. The scrap price has fallen under the drive of finished products. According to the mainstream 304 industrial material purchase price of 9,600 yuan/ton in South China on June 28th, this price is equivalent to a single nickel point price of about 968 yuan/nickel, which is 13 yuan/nickel lower than the same period high nickel iron price, and the economic advantage of scrap stainless steel is obvious. However, considering that the recent nickel iron backflow has recovered slightly, the scrap is under short-term pressure.

Cost and Profit Aspect

📊 As of June 27th, the profit rate of 304 cold rolling smelting by short process technology was 3.09%, an increase of 0.31 percentage points compared to the previous month; the profit rate of 304 cold rolling smelting by purchasing high nickel iron technology was 0.72%, an increase of 0.55 percentage points compared to the previous month; the profit rate of 304 cold rolling smelting by self-produced high nickel iron technology was 0.75%, an increase of 0.31 percentage points compared to the previous month.

Price Trend of Other Raw Materials for Stainless Steel

Nickel Iron

📈 Recently, the backflow of Indonesian nickel iron has recovered slightly, but looking at the monthly backflow of Indonesian nickel iron, there is still a certain gap compared to the historical peak. In addition, the price of Indonesian nickel ore remains high, and some Indonesian iron costs are inverted, with strong support at the bottom of nickel iron prices. Subsequent attention is still needed for the latest market transaction dynamics and the situation of Indonesian nickel iron backflow.

Chromium Iron

📉 After the large steel purchase was flat, the factory's offer gradually became conservative, but it was supported by costs and maintained at about 9,000 yuan/50 basic tons of ex-factory, and the factory maintained normal delivery. Under the production of high-position ore prices, the low-priced chromium iron resources are still tight, and the small steel purchase has gradually increased.

Molybdenum Iron

📉 In July, the mainstream steel mill's molybdenum steel output decreased, and market demand shrank. The steel purchase price of molybdenum iron accelerated the downward trend, and the molybdenum iron market was under pressure to fall. The molybdenum iron manufacturer's offer center was adjusted downward, and the spot transaction was light. The short-term molybdenum market is cautious and bearish, mainly cautious and waiting.