Posted on 28 Jul 2022
Domestic prices of 304-grade stainless steel in China continued softening over July 19-26, according to Mysteel's tracking. The greater operating pressure being faced by stainless traders nursing mounting stocks led them to cut their prices further, market sources said.
For example, the spot price of 304/2B 2mm stainless cold-rolled coil (CRC) in Wuxi, a top stainless trading hub in East China's Jiangsu, had dropped to Yuan 17,500/tonne ($2,588.3/t) as of July 26, touching a new low since last June 11 after an on-week fall of Yuan 100/t, Mysteel's survey showed.
"Many stainless traders had a stressful time last week when they realized they were witnessing a large build-up in their stocks," a Shanghai-based market watcher observed.
Trading activities for stainless products and deliveries of finished steel in Wuxi have gradually returned to normal with the relaxation of COVID-19-related lockdowns at more districts in the city, she explained, so the traders' warehouses have received more deliveries from steelmakers that had been delayed before.
Consequently, total inventories of 300-series stainless CRC and hot-rolled coil at commercial warehouses in Wuxi and Foshan in South China's Guangdong swelled to a one-month high of 428,603 tonnes over July 15-21, up by 8.6% on week, according to Mysteel's latest survey. The volume was also 13% higher on year.
Meanwhile, as the stainless market still hasn't seen much improvement in buyer demand during the low consumption season in summer, traders are feeling anxious and hope to reduce their stocks by attracting consumers with lower prices, she added.
The source also predicted that the price of 304 stainless steel will soften further in the short run, as the immediate priority of the traders is on lowering their stock levels, especially as the end of the month is near.
Source:Mysteel Global
