SHANGHAI, June 1 (SMM) — The high-level meeting in China continued to release news of stabilizing raw material prices, which put pressure on stainless steel prices; in addition, shipments of stainless steel to the market have gradually arrived, easing shortages of certain specifications. This weighed on prices. Trading weakened, driving stainless steel spot prices lower.
The low-end negotiated prices of #304 cold-rolled products were between 15,700 and 15,800 yuan/ton. Commodity prices surged Thursday night with higher nickel prices leading the way. Prices for SHFE stainless steel contracts in July jumped, which slightly supported spot prices. Spot prices should fluctuate within a short-term range. The gradual rebuilding of supply has eased freight shortages and current spot prices remain at high levels.
Prices for 200 and 400 series stainless steel remained stable.
Based on raw material inventory prices, profits of #300 stainless steel mills with NPI facilities have remained at high levels and averaged 1,100 yuan/ton last week. Stainless steel spot prices have remained high, but prices for raw materials like high carbon ferrochrome, high grade NPI and stainless steel scrap have not increased significantly, now profits at high levels. Earnings are expected to remain strong given the spot market.
The average discount of high-grade NPI to stainless steel scrap was around 114 yuan/mtu last week, on par with the previous week, keeping high-grade NPI profitable . Steel mills did not restock in large volumes. Stockpiling will lead to sharp increases in high-quality NPI prices, reducing the reduction in high-quality NPI. This will increase the costs of stainless steel.
