1.The current spot price fluctuates weakly
In recent days, the spot price of stainless steel has been fluctuating and weak. Although the cost support still exists, it is difficult for the price to rise without the inventory being digested obviously. The merchants have lowered the price for shipment. On the last day of May, Tsingshan opened the June futures price, and both 304 cold and hot rolled fell, and the chain price was reduced by 600-900 yuan / ton compared with the previous round.
The new round of steel mills’ prices fell, and the market’s price-preserving mentality was loosened again. Compared with the market spot price, the new price was still 200-300 yuan/ton higher than the market price. It is understood that the market received orders after the opening. At present, the mainstream base price of 304 cold-rolled private burrs in the Foshan market is 18,900-19,000 yuan/ton, and the mainstream price of 304 hot-rolled five-foot is 19,000-19,050 yuan/ton. The mainstream price of private 304 cold rolling in Wuxi market is 19,000-19,100 yuan/ton, and the mainstream price of private hot-rolled resource five-foot burrs is 18,850-18,900 yuan/ton.
2.The demand has not increased, and some steel mills have overhauled and reduced production under the pressure of inventory
The stainless steel market continued to be sluggish, with poor market transactions, slow inventory digestion, and high production costs for steel mills. In order to reduce losses, some steel mills reduced production and overhauled. Judging from the current situation of maintenance and production reduction, the overall impact is limited in magnitude.
3.High inventory still needs some time to digest
According to Mysteel’s inventory statistics on May 26, the total social inventory of stainless steel in the mainstream market nationwide was 914,600 tons, an increase of 0.70% week-on-week and a year-on-year increase of 16.26%.
The weakening of futures trading and the reduction of the price of steel mills have caused the spot price to fall in the past two days. Under the situation of uncertain trends, the downstream willingness to prepare warehouses is low. Although the market offers shipments at a discount, the downstream still needs to replenish warehouses and buy at bargain prices. Although the current epidemic situation in various places is improving, it is not expected that the downstream demand for stainless steel will increase significantly in the short term. In addition, the inventory is high, and the market is facing great pressure to destock, and it still needs a certain period of time to repair.