The Indian Steel market has stalled after 21 days lockdown has been imposed in the country. Although, the Ministry of steel has allowed steel units to continue operations, yet the companies have reported having reduced production due to labour unavailability. Even Ferro Chrome market is no exception, some of the mines are still operating with prior permission. However, no deals have been reported as no dispatches are taking place. Producers are willing to comply with the 21 days lockdown to curtail the possible dangers from the spreading of Covid-19.
South Africa:
South African government has imposed 21days lockdown and have stated that all mines need to be shut down. Transnet will close all bulk terminals for the transport of minerals from 26th March 2020.
China:
The spot South African chrome concentrates 40-42% at Chinese ports saw price increased by RMB2/dmtu; As the largest import material of its kind and widely used by alloy plants, RSA chrome is amongst those affected by the national lockdown supposed to last for 21 days. Since the announcement of national lockdown, Chinese chrome ore traders are in intense willingness to hold back offers or increase the price. However, alloy plants need time to respond and actual transactions which are temporarily not reflected yet. The HC Ferro Chrome retail price today also inched up RMB50/50 basis per MT.
Alloy producers also intentionally slowed down the pace of sales with dealers showing more active enquiries. However, impeded by a slump in stainless steel export and lack of new round of alloy pricing by steel mills as well as a slow recovery of domestic demand, users are keeping conservative attitude towards procurement of costly Ferro Chrome.
Future Outlook
China is one of the major importers of Ferro Chrome from India and Chrome Ore from South Africa. The successive lockdown of both South Africa and India may create turbulence in the Chinese market. Meanwhile, the situation in India can be ascertained post lockdown.
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