Macroeconomic Benefits Resonate with Market Sentiment Stainless Steel Prices Expected to Fluctuate Upward in the Short Term

Macroeconomic Perspective: Policy Support Infuses Vitality into the Stainless Steel Market

From a macroeconomic perspective, the introduction of a series of favorable policies has injected a shot in the arm into the stainless steel market. The government continues to increase investment in infrastructure construction, with large-scale projects in transportation, energy, and other fields being launched one after another. These projects have a huge demand for stainless steel, directly driving the consumption of stainless steel in the market. For example, the advancement of large-scale infrastructure projects such as highways, railways, and urban rail transit is inseparable from the support of a large amount of stainless steel materials. In addition, driven by the new “dual circulation” development pattern, the domestic consumer market continues to expand, and industries related to stainless steel, such as home appliances and kitchenware, have ushered in development opportunities, further stimulating the market demand for stainless steel.

The “dual circulation” strategy (integrating domestic and international markets) not only expands the domestic stainless steel market but also optimizes the industrial structure, improves product quality, further enhances the competitiveness of enterprises, consolidates and elevates the position of Chinese stainless steel products in the international market, and drives the growth of exports. With the continuous growth of both domestic and foreign demand, the prospects of the stainless steel industry will be even brighter.

Cost Side: Rising Raw Material Prices Support Stainless Steel Prices

Nickel, chromium, and other key raw materials for stainless steel have seen rising prices, which have further driven up the price of stainless steel. Affected by the tight global supply of nickel ore and the scarcity of chromium ore resources, the prices of nickel and chromium have shown a steady upward trend recently. In particular, nickel ore is difficult to mine and has high environmental requirements. Coupled with increasingly stringent environmental regulations worldwide, nickel ore production is restricted, and market prices have naturally risen.

The rise in raw material prices has directly increased the production cost of stainless steel. Under such circumstances, enterprises have to raise product prices to ensure profits, which has further prompted them to seek more efficient and environmentally friendly production processes and technologies. At present, some forward-looking enterprises have begun to increase research and development investment, explore the application of new alloy materials, and strive to develop products with better performance and lower costs to gain a more favorable position in the market.

Analysis of Supply and Demand: Inventory Reduction, but Supply-Demand Contradictions Remain

As of July 24, 2025, the total social inventory of stainless steel in 89 warehouse calibers in mainstream markets across the country was 1,118,586 tons, a week-on-week decrease of 2.54%. Among them, the total inventory of cold-rolled stainless steel was 625,447 tons, a week-on-week decrease of 2.43%; the total inventory of hot-rolled stainless steel was 493,139 tons, a week-on-week decrease of 2.69%. In this period, the social inventory of stainless steel in 89 warehouse calibers in mainstream markets nationwide showed a downward trend, with various series being digested to varying degrees.

However, despite the reduction in inventory, contradictions between supply and demand still exist. On the supply side, steel mills are facing increased pressure from cost inversion and are suffering losses across all product lines, thus being forced to step up production cuts. At the same time, domestic anti-involution measures may accelerate the alleviation of overcapacity, and stainless steel production is expected to decline further in the future. On the demand side, although it has entered the traditional off-season for consumption, export demand still faces significant pressure due to increased uncertainty in the macroeconomic environment. Downstream enterprises have a low acceptance of high-priced goods, resulting in poor digestion of domestic inventory.

Rising Market Sentiment: Active Futures Market, Prices Expected to Fluctuate Upward

Traders and downstream enterprises in the market have also been affected by the optimistic sentiment and started to increase their inventories. This phenomenon indicates that against the background of macroeconomic benefits and rising market sentiment, stainless steel prices have the basis to fluctuate upward in the short term. It is worth noting that this rise does not solely rely on market sentiment but is based on the recovery of actual demand and good expectations for future development.

Conclusion

To sum up, the current stainless steel market is in a complex, volatile, yet opportunity-filled period. On the one hand, benefiting from government policy support and the expansion of the domestic consumer market, the stainless steel industry has ushered in new development opportunities; on the other hand, the cost pressure brought by rising raw material prices is testing the wisdom and capabilities of every practitioner. Looking ahead, driven by macroeconomic benefits and market sentiment, stainless steel prices are expected to continue their fluctuating upward trend. However, in the face of global economic uncertainty and fierce market competition, how to seize opportunities and cope with challenges will be an important issue that every stainless steel enterprise must consider.