Stainless Steel Scrap prices are expected to rise in China as all the other Ferro Alloy prices sky-rocketing (specially Silico Manganese and Ferro Silicon). In light of the same, Stainless Steel producers are likely to divert their attention to procuring more of Stainless Steel Scrap.
A leading Chinese stainless-steel manufacturer Aoyama, has increased its Ferro Chrome purchase price for Jan’18 by 200 Yuan at 7,296 Yuan (USD 1,137), in response to the rising Chrome Ore offers.
In fact, almost all major Stainless Steel producers like Baosteel, Tsingshan, and TISCO have all raised their Jan’18 purchase price by 200 Yuan. Baosteel has increased its purchase price to 7,300 Yuan for Jan’18 deliveries. Moreover, Ohara Steel (TISCO) and Zhangjiagang POSCO, whose prices were 7,100 Yuan in Dec’17 are also expected to raise them by 200 Yuan.
Additionally, amid soaring ferroalloy offers in China due to a supply crunch, Ferro Silicon prices in Europe and US touched 9-years high at USD 1,600-1,700/MT. Moreover, rising Manganese ore offers coupled with low production of Silico Manganese in China, has boosted the alloy’s price globally.
Furthermore, during December, UG2 (Cr 42%) chrome ore prices from South Africa has witnessed a sharp rise. In the beginning of the month, the prices were recorded at USD 160/MT, which has increased to USD 200-210/MT in a period of 22 days, despite a rise in its production.
The offers for Ferro Chrome in the spot market remained in the range of 85-90 cents/lb, while the European benchmark for the same has come down to 118 cents/lb, lower by almost 21 cents/lb. However, with rising Chrome Ore prices coupled with low Ferro Chrome supply, the prices may get triggered upwards.
China produces more than 50% of world’s stainless steel and is expected to raise its production in near-term due to its strengthening demand. Hence, a rise in demand for Ferro Chrome is a prospect, which in turn is expected to elevate the purchase price as well.
Stainless Steel scrap, being one of the alternatives of Ferro Chrome may also remain in demand during high stainless-steel production. Therefore, the market participants are of the view that the SS scrap market will also see a price hike in 2018.
Leave a Reply