Ferro Chrome demand from China has risen in line with its traders and stainless-steel producers having run down their inventories.
As the inventories are drying up, the buyers who were previously exploring the bottom prices of Ferro Chrome have started inquiring for the commodity. This has encouraged Ferro Chrome producers to raise their offers.
“Though inquiries from China have increased however deals have not yet been concluded up to desired levels, but none the less market sentiment has improved and there is an understanding in the market that prices have gone up from last week,” said a producer source expressing his confidence. The producers have shown rigidity in terms of pricing and are now going to reap the benefits, he added.
The buyers, on the same note, are also resisting high offers but deals have been concluded little above the May tender prices at 84 cents/lb CIF China.
Mirroring the Chinese market, Japan and South Korea were observed to have accepted higher offers but inquiries from the regions are still awaited as they are in a wait-and-watch mode. Export offers to Japan and South Korea are assessed at 90 cents/lb and 89 cents/lb CIF basis respectively. Indian producers are anticipating demand from South Korea and Japan in the coming week.
A rise in Chrome ore prices have also supported the Ferro Chrome offers in China as it regained a stable position after being bottomed out. Mainstream price for South Africa Chrome Ore (40-42%) Conc. has increased to USD 195-200/MT CIF China, from last week’s price at USD 190/MT.
Following the Chinese market, the Indian producers have also raised their offers in the domestic market to INR 72,000-73,000/MT.
“The Indian Ferro Chrome producers are not under selling pressure as most of them are already booked for the month and there is a supply shortage of commodity in the market,” a source said. SteelMint assessed that Ferro Chrome prices had reached the bottom and producers were eagerly waiting for any positive news to push up prices, as their margins were substantially squeezed.
On the future outlook, the Ferro Chrome prices might witness stability while some participants expect it to move up. However, other players predict that some major Chinese stainless-steel mills might go under maintenance, forcing the demand for Ferro Chrome to shrink again in near future.
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