en.Wedoany.com Reported - China's stainless steel market enters a phase of planned production cuts and maintenance shutdowns in June, with market expectations that supply-demand balance will improve. Despite persistently weak seasonal demand during the traditional off-season, market participants anticipate that production cuts will help stabilize prices by reducing inventories and easing supply pressure.
According to market estimates, China's crude stainless steel output in June is expected to reach 3.58 million metric tons, down 4.4% month-on-month. Among the categories, the 200 series will see the most significant decline, with output expected to fall 10.7% to approximately 940,000 metric tons. Output of the 300 series and 400 series is expected to decline by 1.6% and 2.9%, respectively. China's Ministry of Industry and Information Technology (MIIT) has issued revised steel capacity replacement measures, bringing stainless steel capacity under regulatory oversight, further supporting the momentum of production cuts.
Several major stainless steel producers, including Baogang Desheng, Taigang Stainless Steel, and Hualer Alloy, have announced maintenance plans for June. The total production loss from these shutdowns is estimated to exceed 160,000 metric tons. A major producer based in Jiangsu is expected to halt production for nearly 26 days starting June 6 for equipment maintenance, resulting in a production loss of approximately 65,000 metric tons. The impact is expected to be concentrated mainly on 200 series narrow strip products, potentially creating spillover effects on regional supply.
Market participants expect that the production cuts will reduce the circulation of 200 series narrow strip materials and 300 series cold-rolled stainless steel, helping to alleviate inventory pressure. However, the extent to which reduced supply can translate into price increases remains uncertain amid subdued downstream demand.
June typically marks a seasonal slowdown in China's stainless steel consumption. Demand in key end-use industries such as construction, kitchenware, home appliances, and industrial manufacturing remains sluggish. Pipe manufacturers report that order inflows and transaction volumes are lower than in previous years, prompting buyers to continue purchasing on a need-only basis. Despite supply-side adjustments, this cautious procurement strategy is expected to limit any substantial recovery in stainless steel prices.
China's stainless steel export market continues to face pressure. From January to April 2026, China's total stainless steel exports amounted to approximately 1.2 million metric tons, down 28.5% year-on-year. Market sources attribute this to the implementation of export licensing requirements and an increase in trade protection measures in several overseas markets, which have reduced export competitiveness and shipment volumes.
On the raw material front, nickel continues to provide cost support for stainless steel prices. Supply concerns persist due to reduced mining quotas in Indonesia and the conversion of some nickel pig iron (NPI) production lines to nickel matte production. Several rotary kiln electric furnace (RKEF) operators in Indonesia's Kalimantan region are expected to shift some capacity from NPI to nickel matte starting in June, potentially reducing high-grade NPI output by approximately 2,600 metric tons of nickel content per month. However, cost pressures have eased following Indonesia's exclusion of NPI from its export consolidation policy, alleviating concerns about additional supply restrictions compared to May.
Meanwhile, TISCO has kept its June high-carbon ferrochrome procurement price unchanged at 8,295 yuan per 50-base metric ton, indicating continued stability in the ferrochrome market. The 400 series stainless steel also continues to show relatively weak but stable price trends. The current production cost for cold-rolled 304 stainless steel using high-grade NPI is estimated at around 14,500-14,800 yuan per metric ton. Market participants note that while alloy raw material costs continue to provide a price floor, their ability to push prices higher has significantly weakened.
Market sentiment in June remains cautiously balanced. Planned production cuts are expected to help reduce inventories and improve supply-demand fundamentals, potentially supporting a modest price recovery in the second half of the month. However, weak downstream demand, cautious buyer sentiment, and diminishing nickel cost support may limit any significant upside. As a result, China's stainless steel market is expected to maintain range-bound fluctuations in the near term, with average prices in June likely falling below May levels despite ongoing supply-side adjustments.
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