With the slight rebound in London Metal Exchange (LME) nickel prices, China's domestic stainless steel market has also witnessed some slight upticks in prices in the past week, especially for 304 series for which prices have risen by a margin of about RMB 100-200/mt week on week.
Global nickel prices have indicated some upward movement during the past week. On July 16, the three-month nickel price at the LME closed at $13,740/mt, while LME nickel inventory on the same date totaled 196,074 mt.
Some Chinese stainless steel mills have been carrying out equipment overhauls in June and July, while bad weather has adversely impacted transportation. These factors have contributed to a reduction in supply volumes, thereby providing support for the upward movement of market prices. While the negative sentiment in the market has diminished, traders are still somewhat cautious. The imbalance between supply and demand continues to exert downward pressure on the market, especially with the slackness of demand during the current off-season. Also, with producers expected to complete their overhaul works in the near future, supply volumes will increase. For the coming week, it is thought that Chinese domestic stainless steel prices may show signs of weakness.