In contrast to the release of the HC ferrochrome tender price of Tisco for the fourth quarter, the tender price of the mainstream steel mills in the south is yet to be rolled out. In addition to the different behaviors of steel mills in the North and South, there is also a difference in chrome ore trading at ports. Take the RSA chrome concentrates as example, the 40-42% price has been increased from RMB31/dmtu to RMB33/dmtu.
The main reasons for the obvious gap between the South and North South Africa chrome ore are:
1. Tisco bumped up RMB400/50 basis per ton for its fourth quarter’s HC ferrochrome tender price, which is conducive to drive up the operating rate of northern alloy plants. RSA concentrates as a must material for production is needed.
2. This week, as the last week before the National Day holiday, will see picked up procurement by the northern plants to prepare inventory backup to avoid traffic control during the national day, which will prop up spot price.
3. Most of the southern factories mainly go for futures purchases. Some of the alloy factories purchasing spot goods found them lack of guiding prices before release of tender prices, leading to weak enthusiasm for spot enquiry and transactions, which provides little prop to ore price.
4. The price of chrome ore in the north and the south has always been different, and the price of the southern port is RMB2-3 /ton higher than that of the northern port for a long time. Given that the spot price of chrome ore has maintained a stable operation recently, it is understandable that the chrome ore at southern port did not go up.
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