In just half a month, the price of stainless steel futures rose by 13%. In the beginning of 2026, the price of stainless steel futures staged a strong rebound that attracted the attention of the industry. The cost increase and inventory decline became the main driving forces of this round of market.
Recently, the most striking change in the futures market is the continuous rise of stainless steel varieties. In January, 2026, the rise of stainless steel futures accelerated, and the main contract closed the daily limit on January 7, and the closing price climbed to 13,885 yuan/ton.
Since the rebound started in late December 2025, the cumulative increase of prices from the previous low point to now has exceeded 13%. The spot market also responded positively, and the base price of the mainstream 304 cold-rolled private burrs has increased by 600-750 yuan/ton in January.
1.market start: the soaring price of nickel ignites the market fuse.
The direct engine of this round of stainless steel price increase comes from the strong soaring price of nickel, its core raw material.
As the main source of nickel ore supply, the change of Indonesia's industrial policy is the focus of the market. It is widely expected that the Indonesian government may substantially tighten the export quota of nickel ore in 2026. Recently, Vale, an Indonesian nickel enterprise, has suspended mining operations because the quota for the new year has not been approved, which further aggravates the market's concerns about the future supply of raw materials.
Geopolitical risks have also become a contributing factor. The dramatic changes in the relationship between the United States and Venezuela have aroused widespread concern about the stability of global resources in the market and promoted the overall strength of the non-ferrous metal sector.
Under the strong expectation of tight supply, the quotation of ferronickel continued to move up, and the supplier's quotation generally rose to 960-970 yuan/nickel. This makes the cost support of stainless steel extremely solid.
2.Market reaction: steel mills' prices and inventory "five consecutive declines"
After the cost has risen sharply, the attitude of steel mills has become the key to the market trend. Huaxin, Tangrong and Yelian, the major domestic stainless steel producers, have successively set the price in January 2026, with the main tone of rising.
Among them, Huaxin 300 series increased by 4,000 yuan per ton, and the 304 products of Tang Rong and Yelian increased by 5,000 yuan per ton or per metric ton.
There are also positive signals at the market supply level. According to the statistics of industry organizations, the domestic stainless steel crude steel output decreased by 6.5% in December 2025. More crucially, the social inventory of stainless steel has dropped below 1 million tons, and it has maintained a continuous trend of "five consecutive declines".
As of New Year's Day, the total inventory has dropped to about 930,000 tons. Supply contraction and inventory decline have jointly created a favorable environment for price increases.
3.Industry changes in temperature: high cost and profit roller coaster.
Despite the rising prices of finished products, the rapidly changing raw material costs are squeezing the profit margins of steel mills and downstream enterprises. Taking the most mainstream 300 series stainless steel as an example, the cost of nickel raw materials accounts for about 61% of its total cost, and the cost of chromium raw materials accounts for about 20%.
Therefore, any change in nickel price will be directly transmitted to the final product.
According to the spot cost-profit model data of Mysteel, on January 7th, the smelting profit rate of 304 stainless steel was 4.37%. On the previous day (January 6), its profit margin was only 1.18%.
This clearly shows that the tug-of-war between cost and finished product price is extremely fierce, and corporate profits have experienced great fluctuations in a short time.
4.Game in the market outlook: a contest between strong expectation and weak reality
The current hot market of stainless steel is characterized by "expectation-driven". Although the price is strong, the actual transaction of high-level resources has shown fatigue, and the buyer's wait-and-see mood has increased. This reflects the market's general caution about whether "strong expectation" can be realized as "strong reality".
In the short term, the market focus is highly focused on the final landing rhythm of Indonesia's nickel mine policy. Any news that exceeds expectations may trigger drastic price fluctuations.
From the medium and long-term fundamental observation, the core contradiction between high supply and weak demand is still outstanding. The recovery of traditional stainless steel consumption areas such as real estate and household appliances remains to be seen, and the export market faces many uncertainties in overseas trade policies.
The follow-up trend of the market will be more game-like, and the volatility may also increase.
