China's domestic 304-grade stainless steel prices fall amid raw material weakness

Mysteel Global: China's prices for 304-grade stainless flat steel continued to decline during 5-11 December with those for both cold-rolled coil (CRC) and hot-rolled coil (HRC) losing ground. The fall was primarily due to weakening cost support from raw materials such as nickel pig iron (NPI) and ferrochrome (FeCr).

As of 11 December, the price of Hongwang's 304-grade stainless CRC in Wuxi, a major stainless trading hub in East China's Jiangsu province, at RMB 13,100/t ($1,803/t) in-warehouse, including VAT. This marked a w-o-w drop of RMB 100/t ($14/t) and hitting its lowest level since November 2020.

Similarly, the price of Tsingshan's 304-grade stainless HRC also in Wuxi declined by RMB 50/t ($7/t) over the week to settle at RMB 12,550/t ($1,724/t) in-warehouse, including tax.

The decline in prices was mainly attributed to reduced support from raw material costs. From 4-11 December, the price of nickel pig iron in Jiangsu fell to RMB 955/t ($131/t), a decrease of RMB 10/t ($1.3/t) w-o-w. Similarly, high-carbon ferrochrome prices in Inner Mongolia dropped by RMB 200/t ($27/t), reaching RMB 7,300/t ($1,003/t) (50 Cr), the lowest level since May 2021.

Additionally, stainless end-users had adopted a more cautious approach to purchasing 304-grade stainless flats during the week amid growing pessimism about future market prospects. The survey indicated that daily trading volumes of 304-grade stainless CRC in Foshan, another key stainless trading hub in South China, averaged 2,061 t/day over 5-11 December down from the previous week's 2,182 t/d.

Despite slower trading activity, stocks of austenitic stainless flats in domestic warehouses saw a slight dip after a previous week's rise. The data from 89 warehouses across six Chinese cities revealed that as of 12 December, total inventories of 300 series stainless steel stood at 604,424 t, a 0.34% decline compared to the previous week.

The slight dip in stocks was largely attributed to delays in transferring newly arrived seaborne austenitic stainless flats produced elsewhere in China from ports to warehouses, market sources noted.

Note:This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.