- Indonesia eases NPI export policy-related concerns
- Higher production, weak demand weigh on prices
SteelDaily: China’s stainless steel market is expected to remain under downward pressure in June 2026, amid weakening raw material cost support and sluggish downstream demand recovery. Increased nickel ore shipments from the Philippines and easing policy concerns in Indonesia are expected to weigh on nickel and stainless steel prices in the near term.
Rising nickel ore supply weakens cost support
Nickel ore supply from the Philippines increased sharply in May following the end of the rainy season, resulting in a decline in ore prices. Market participants expect shipments to continue rising in June, leading to higher port inventories in China and further easing raw material tightness.
The increase in ore availability is also expected to weaken cost support for nickel pig iron (NPI), with miners likely to offer more price concessions amid oversupply concerns and softer downstream demand.
Indonesia eases NPI policy concerns
Indonesia’s decision to exclude NPI from its proposed export concentration policy significantly reduced supply concerns in the nickel market. However, ferro nickel products will remain under existing export regulations.
Despite easing policy uncertainty, the NPI market continues to witness quality-based price divergence. Lower ore grades have reduced nickel content in some NPI projects to nearly 11%, while premiums for high-grade NPI remained firm due to limited availability.
Stainless steel demand recovery remains weak
China’s crude stainless steel production in May increased by around 0.9% m-o-m and 9.2% y-o-y to nearly 3.78 million tonnes (mnt). Production of 300-series stainless steel reached around 2.05 mnt, supported by improved profitability and higher operating rates among mills.
However, downstream demand recovery remains sluggish across key sectors, including real estate, home appliances, kitchenware, and machinery manufacturing. Market participants noted that procurement activity remains strictly requirement-based, with buyers delaying purchases amid uncertain price trends.
Although some mills may undertake maintenance activities due to rising inventory pressure, the market continues to face oversupply concerns and weak spot demand.
Outlook
China’s stainless steel prices are expected to remain weak in June amid softer nickel ore prices, easing cost support, and subdued downstream demand. However, government stimulus measures, Indonesian raw material policies, and potential production cuts by Chinese mills will remain key factors influencing market direction.
This article is published as part of a content exchange agreement between SteelDaily and BigMint.
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