The production of stainless steel mills has increased by 2% -3%, and the upstream and downstream have remained stagnant

In the initial stage of the stainless steel "golden nine silver ten", whether the peak season has arrived as scheduled, but according to the current market rhythm, it seems that there is not a very hot atmosphere. Whether upstream or downstream, most of them are still "standing still", and most of them are still at the level of traders.

Fine adjustment of stainless steel crude steel and cold rolling production

Not much change

According to Mysteel research, the production of stainless steel crude steel increased by 2.3% in August and the production of cold rolling increased by 3.83%; In September, the production of stainless steel rough steel is expected to increase by 0.8%, and the production of cold rolling is expected to increase by 1.78%.

From the data, although some departments have varying degrees of increase, overall, the changes in production are not significant. In fact, it can be seen that the production of steel mills has been adjusted due to cost profit or raw material procurement issues, which may lead to changes in production plans. Currently, it is not in a centralized maintenance period and there is no need to actively reduce production, Therefore, the overall production remains incremental, but also due to the slow sales in the spot market, inventory destocking is not significant, and the increase in production is not significant.

Operation with high raw material prices

The profit of stainless steel mills is compressed

Due to the frequent occurrence of nickel mine accidents in Indonesia, nickel iron plants are currently optimistic about the expected market, which has led to a stronger nickel iron price; And ferrochrome also shows a steady upward trend due to the high price of chromium ore. The price of raw materials is relatively strong, and for the cost of stainless steel, it is also trending upwards.

However, from the perspective of the spot market, the fluctuations of the 300 series have been slightly slower recently. Due to the weak atmosphere of inquiries and transactions, the market's hype mentality and "competitive gambling" operations have decreased since 2023. The space for spot prices to rise is limited. In the case of controllable costs and adjustable production, steel mills often choose sectors with larger profit margins for production and sales, So we can also see that although the overall change in production of both stainless steel rough steel and stainless steel cold rolling is not significant, there are many adjustments in each department.

Slightly slower changes in stainless steel warehouse

Weakening the directional significance of prices

The production of stainless steel mills continues and is in an increasing trend. The increase in social inventory is slow, and the overall growth rate is relatively flat. This is partly due to the continuous supply and partly due to low downstream enthusiasm.

Although we have entered the peak season of stainless steel, we can also see that the market atmosphere is not as active as people imagine. We still purchase according to the basic demand, and the processing factory has reported that the recent processing volume is relatively stable, without saying that there is a significant fluctuation or that there are no orders, all of which are maintaining a stable state. And some steel mills are starting to expand into downstream fields, directly delivering goods to downstream end customers, leading to a phenomenon: "The quantity of steel mills is increasing, but inventory has not increased much, and traders do not feel the improvement of business.

The spot price is actually determined by the supply and demand relationship. Currently, due to the strong price of raw materials, the cost of stainless steel is difficult to maintain in the short term, which still has a certain supporting effect on the spot price and has fallen.