1、 Price fluctuations: a tug of war between cost and demand

The overall market for 304 stainless steel sheets showed a positive trend in March, with prices running relatively strong. However, on the first day after the holiday, the prices of 304 cold and hot rolling decreased significantly. The mainstream price of private 304 cold-rolled wool base has fallen to 13000-1050 yuan/ton, a decrease of 100-200 yuan/ton, mainly due to the impact of US tariff policies. Commodities have generally fallen, and the low opening of stainless steel futures has dragged down confidence in the spot market. The price of five foot rough edges for 300 series hot rolling resources has synchronously dropped to 13000-1050 yuan/ton.

The pre holiday market demand procurement has basically ended, and the 300 series transactions are mainly whole roll transactions. Merchants accept orders in limited quantities, but there has been no significant fluctuation in mainstream prices. After the holiday, there is a strong wait-and-see sentiment in the market, with overall transactions being weak except for a small number of essential orders. Due to the completion of pre holiday inventory replenishment, the number of inquiries for the 400 series has significantly decreased, and actual orders need to be negotiated and facilitated. In terms of the 200 series, after the agent quotation of South China Steel Plant was lowered, some merchants continued to offer discounts, but transactions still focused on low-priced resources.

The main reasons for market price fluctuations are as follows: 1. External policy shocks. The US tariff policy has put pressure on the commodity market, causing stainless steel futures to decline simultaneously, further suppressing spot prices. 2. The support for raw material costs is limited. Although the prices of nickel iron and chromium iron have been supported, the transmission effect of raw material fluctuations on stainless steel prices has weakened, which has not effectively boosted market sentiment.

2、 Inventory fluctuations: prediction of the trend of the 304 stainless steel sheet market

According to the latest inventory data in the Wuxi area, the 200 series inventory in the Wuxi market is 71035 tons, with an increase in cold rolling and hot rolling of the 200 series this week. Affected by the previous rise and firm spot prices of the 200 series, although sales slowed down this week, resources were quickly digested in the early stage, and there were fewer arrivals during the week, mainly from hot-rolled resources. The inventory of 300 series is 505782 tons. This week, there was an increase in cold rolling and a decrease in hot rolling for 300 series. Hot rolling transactions were better than cold rolling during the week. In addition, there was an increase in cold rolling warehouse receipts. Currently, the downstream market has a skewed wait-and-see attitude, and the overall procurement pace has slowed down. The inventory of 400 series is 76722 tons, and both cold and hot rolling of 400 series have decreased this week. The main focus is on reducing the amount of pre inventory pickup by large factories in Northwest and North China.

According to statistics, the market has concentrated on digesting 200 series cold rolling and 300 series hot rolling, and has concentrated on receiving 300 series cold rolling resources. However, the post holiday demand has not been effectively undertaken, resulting in rapid inventory accumulation. Due to the extended transportation cycle, some resources have been delayed in storage, exacerbating market concerns about inventory pressure. Some specifications are out of stock due to reduced production scheduling or transportation restrictions by steel mills, but the inventory of cold-rolled general materials is high, and businesses are more willing to offer discounts to reduce inventory.

3、 Raw material fluctuations: Cost support for 304 stainless steel sheet still exists

The price of nickel iron has continued to rise since early March, with an overall positive trend, but there has been a downward trend after the Qingming Festival. Since the beginning of this year, the production of nickel iron in Indonesia has continued to increase, with the global plan to add more than 10 million tons of stainless steel production capacity. Coupled with the new production line of Indonesia's nickel iron smelting project, the pressure on the nickel iron supply side is significant. At the same time, domestic production has also rebounded. Although some domestic nickel iron plants have reduced production due to losses, the return flow of Indonesian nickel iron has increased. In March, the export volume of Indonesian nickel iron to China increased by 9.9% year-on-year, intensifying competition within the market.

Due to logistics restrictions on South African chrome ore exports and rising domestic electricity costs, the production cost of ferrochrome remains high. There is a limited supply of retail goods in the market, and there is a continuous upward trend in the price of ferrochrome. The price range of ferrochrome factory quotations has widened and differentiated, and the gap between retail prices and steel bidding prices has widened again. Downstream purchases are becoming more cautious. Therefore, although there are transactions in the market, the atmosphere of inquiries has weakened, and there is limited room for further growth. However, as demand and costs gradually increase, there is still some support for future generations, and it is expected that the chromium iron market will maintain a strong operation in the short term.

4、 Summary

The market for 304 stainless steel sheets has undergone significant changes before and after the holiday, and spot prices are affected by international and domestic macro sentiment, which may be difficult to improve in the short term. Market merchants' bullish sentiment in the early stage is gradually fading, and they are temporarily observing the market situation. After the holiday, the market will gradually receive goods, and inventory digestion still requires a certain amount of demand to maintain. Under the downward trend, warehouse receipt resources are flowing out. Although the prices of raw materials nickel iron and chromium iron have declined, there is still some support, and we need to pay attention to the latest changes in macro policies in the future.