Indian ferro chrome demand in the domestic market remains low to moderate, meanwhile, the increased chrome ore prices are refraining the producers from lowering their offer levels. The transactions are hovering at around INR 70,000/t, however, a few small deals were done at marginally higher levels.
Meanwhile, the export demand hasn’t picked up, with limited inquiries in the market. The long-term contracts are being concluded, however, demand from the spot market remained low, with limited deals as most buyers await the November Chinese tender prices. The international prices are still lower than in the domestic market, but the news of an export tax on South African chrome ore exports is being viewed as a positive for global ferro chrome prices.
The proposal on the imposition of taxes on Chrome ore exports from South Africa is big news for China. However, there has been no clarity on the amount of tax that would be imposed or when it would come to effect.
The imposition of tax has been opposed earlier too by the lobby of miners, who do not have their smelting units. However, the pandemic has made the government more eager to act now to generate income and support their national economy with job creation. Meanwhile, the ferro chrome industry in South Africa might get support from the taxing system, but high-power tariff continues to trouble them.
It is expected that the Chinese buyers will look to procure as much chrome ore as possible before the export duty is levied, thereby pushing up chrome ore prices and ferro chrome prices in China. Moreover, with the appreciated Chinese Yuan will make it more feasible for Chinese buyers to import ferro chrome.
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