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Weekly Average Price|| 304 dropped by US$92/MT. Stainless Steel Market Summary in China(2nd, Nov – 6th, Nov)


304/2B: The average price of 2.0*1219*C (slit edge) of ZPSS in the Wuxi market is US$2,270/MT(plus taxes) which is US$2/Mt lower than that of last week, and the decreasing percentage is 0.06%. Besides, the average price of 2.0*1219*C(slit edge) in the Foshan market is US$2,310/MT(plus taxes) which increases by US$18/MT, and the increasing percentage is 0.75%.

304/2B: The average price of 2.0*1240*C (mill edge) of Hongwang in the Wuxi market is US$2,125/MT(plus taxes) which is US$62/MT lower than last week and the declining percentage is 2.7%. Besides, the average price of 2.0*1240*C (mill edge) of Hongwang in the Foshan market is US$2,105/MT(plus taxes) which decreases by US$51/MT compared with last week and the decreasing percentage is 2.28%.

304/No.1: The average price of 4.0*1520*C (mill edge) of ESS in the Wuxi market is US$2,055/MT(plus taxes) which decreased by US$37/MT compared with last week and the declining percentage is 1.7%. Furthermore, the average price of 4.0*1520*C(mill edge) in the Foshan market is US$2,060/MT(plus taxes) which is US$35/MT higher than last week and the decreasing percentage is 1.63%.

316L/2B: This week, the average price of 2.0*1219*C of TISCO in the Wuxi market is US$2,955/MT(plus taxes) which dropped US$9/MT compared with last week and the decreasing percentage is 0.29%. Moreover, the average price of 2.0*1219*C(slit edge) of TISCO in the Foshan market is US$3,010/MT(plus taxes) which remains as last week.

316L/No.1: This week, the average price of 4.0*1500*C(mill edge) of ESS in the Wuxi market is US$2,775/MT(plus taxes) which is US$32/MT less than last week and the decreasing percentage is 1.09%. What's more, the average price of 4.0*1500*C(mill edge) in the Foshan market is US$2,820/MT(plus taxes) which is US$15/MT less than last week and the declining percentage is 0.51%.

201/2B: This week, the average price of 1.0*1219*C(mill edge) of Hongwang in the Wuxi market is US$1,150/MT(plus taxes) which is US$2/MT more than last week and the rising percentage is 0.13%. Besides, the tax-inclusive average price of the Foshan market is US$1,145/MT(mill edge) which increases by US$4/MT compared to last week and the increasing percentage is 0.53%.

J2, J5/2B: The average price of 1.0*1219*C(mill edge) of the Wuxi market is US$1,085/MT(plus taxes) which is US$2/MT higher than last week and the rising percentage is 0.14%. Besides, the tax-inclusive average price of the Foshan market is US$1,100/MT(mill edge) which increases by US$6/MT compared with last week and the increasing percentage is 0.56%.

430/2B: The average price of 2.0*1219*C(slit edge) of TISCO in the Wuxi market is US$1,295/MT(plus tax), which is US$9/MT higher than last week and the rising percentage is 0.70%. The average price of 2.0*1219*C(slit edge) in the Foshan market is US$1,275/MT(plus taxes) which increased by US$15/MT and the rising percentage is 1.19%.


304 dropped by US$92/MT in a week. Inventory of southern China steel mills increase. 



Last week, the global market put all eyes on the US election. The US stock increased significantly within the week—— Dow J increased by 6%, NASDAQ spiked by 9% and LME nickel also kept increasing under such a boosting atmosphere. However, on Friday night, at around 22:50, the LME nickel price cut down US$300, closed at US$15,260/MT which was US$215 lower. Meanwhile, the stainless steel futures showed the same trend. Contrast 2101 went down by US$62, which at last decreased by US$21 and closed at US$2,005/MT.
 


304 price accumulated to reduce US$92/MT last week. 

In last week, “price reduction” was overwhelmed in the 304 market. Steel mills firstly reduced US$46/MT-US$62/MT, so did the agents and traders. Profit loss is impossible to avoid. In the Wuxi market, cold-rolling 304 of the private-own mills dropped by US$62/MT, and even more, in the Foshan market, the reduction has reached US$92/MT. Take Delong as an example, within 5 days, the 4-feet mill-edge 304 price has decreased from US$2,150/MT to US$2,095/MT
 
On Saturday(7th, Nov), the market was stable. Take the Wuxi market, cold-rolling 4-feet mill-edge stainless steel of Delong, and Chengde maintained at around US$2,000/MT- US$2,045/MT (US$2,105/MT-US$2,115/MT in 2.0 slit); 4-feet mill-edge of Yongjin was around US$2,700/MT (US$2,140/MT in 2.0 slit). The hot-rolling 304 in private-owned mills kept in US$2,015/MT.    


Inventory has been increasing. New arrivals are in the southern steel mills.



On 6th, November, the weekly stainless steel inventory of Wuxi increased by 3.2 thousand tons compared with a week ago, 30th October, and reached 483.2 thousand tons. Of 300 series, the inventory was 368.1 thousand tons, which increased by 4.6 thousand tons; Of 200 series, the inventory was 48 thousand tons and it reduced by 1.9 thousand tons; Of 400 series, the inventory was 67.2 thousand tons, which increased by 500 tons. 

Steel mills have been in a down vibe because the spot market price has fallen due to the lower opening prices of steel mills. People mostly hold a pessimistic attitude towards the market and the downstream buyers are cautious, so the transaction is gloomy. 

According to the market, lately, there are new arrivals to Chengde, Tsingshan, Hongwang, and other steel mills, so some warehouses are full.


Summary:

Steel mills cut prices down. There is an explanation that perhaps the steel mills are really not selling smoothly because the stainless steel prices have stayed high while the downstream demand was low. Moreover, many traders tend to maintain the profit of the year during the last two months, so they are unwilling to gamble the futures in the market. Steel mills also have their production missions to accomplish, so steel mills focus much on the production—— reducing the price to sell more products. 

Another opinion is that to suppress the price of raw materials, thereby reducing production costs,  because according to the transaction price, US$189/nickel, for now, the production cost of steel mills is way higher than the market price. Recently, the stainless steel stock price has reduced, which it seemed to work—— ferronickel price began to fall. However, the decrease was not as much as people expected. What actions will the steel mills take to mobilize the market? Let’s see.   



Raw Materials|| Stop increasing! What steel mills giants reduced the prices?   

Stepping into November, the Chinese high carbon ferrochrome price trend broke the dilemma. Major production factories reduced the quoted prices, reducing US$15/MT of 50% concentration. In Inner Mongolia, the price went down to US$877/MT of 50% concentration.

Lately, lacking price support, the price of high carbon ferrochrome decreased, so the bidding prices from the main steel mills also dropped:



Tsingshan:

In November, the bidding price is US$907/MT of 50% concentration(tax-inclusive to factory), which is US$15/50% concentration lower compared with that in October. If delivered to Tianjin port, the price can be cut down US$23/50% concentration. The delivery date is no later than 15th December 2020.


Tisco:

In November, the bidding price is US$877/MT of 50% concentration(tax-inclusive to factory in cash), which is US$15/50% concentration compared with that in October. The delivery date is no later than 15th December 2020.


Baosteel Desheng:

In November, the bidding price is US$908/MT of 50% concentration(tax-inclusive to factory in cash), which is US$15/50% concentration lower compared with that in October.


Jisco:

In November, the bidding price is US$900/MT of 50% concentration), which is US$15/50% concentration lower compared with that in October.

From the perspective of the supply side, the high chrome production in October reached the new highest, over 530 thousand tons. The supply of high chrome has been adequate, as well as there will be more new production trial in Inner Mongolia, so it is predicted that, in November, the high carbon ferrochrome supply will keep rising.

As for the demand side, although the stainless steel production remains high, lately due to the high ferronickel price, many steel mills have been losing profit. With such a high producing cost, the production of steel mills can hardly increase. Even it is possible that it will reduce production, which will influence the ferrochrome demand undoubtedly.  


---------------------------------------------------------------------------------Stainless Steel Market Summary in China---------------------------------------------------------------------------------


 

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