Indian High Carbon Ferro chrome market was in a lull condition as China went on holidays and nobody was inquiring for any material.
The domestic High Carbon (HC) Ferro chrome market witnessed muted demand as end-users withdrew on shaky market sentiment. Current prices for HC Ferro chrome (60% grade) are hovering in the range of INR 67,000-68,000 /MT (ex-works, Odisha). In Raigarh, prices are around INR 69,000/MT. Most of the Ferro chrome produced in India is exported to the Far East (China, Japan, South Korea and Taiwan) since it is the epi centre of stainless steel production and also considering our logistical advantage. Indian producers rely heavily on export sales, and they will have to find other markets to sell Ferro chrome as Chinese production has substantially risen and are less reliant on India.
“Demand for Ferro chrome has been low on all fronts, both domestic and foreign,” said one Indian producer source.
IDCOL Auction
Earlier in the month, IDCOL Ferro Chrome & Alloys had invited tenders for sale of about 2,600MTHigh Carbon Ferro chrome (HCFC). According to industry sources, bids were received to the levels of INR 64,760 /MT (78.9 cents/lb), ex-works. SteelMint assessed that only a few mills participated in the tender and SAIL was awarded close to 90% of the material.
Industry seeks Clarity on Import Duty
Budget 15-16 could bring some relief to Indian Ferro chrome industry. The basic customs duty on all steel items falling under chapter 72 is raised to 10% vide the notification No. 10/2015 of the Ministry of Finance dated 1 Mar’15. This may restrict imports from Oman and South Africa, which has increased in the past 2-3 months. However, some Ferro chrome producers are still looking for clarity and believe import duty on Ferro Alloys is to remain at 5%.
Chinese Market
The spot price of South African-origin charge chrome (48-52% Cr) is steady at 79-80 cents/lb, CIF China with some participants still out for the New Year holidays. No deals or offers could be confirmed this week. But, there was word of a deal for standard lump material at around 80 cents/ lb, CIF done before the holidays.
The spot price of Indian-origin HC Ferro chrome (58-60% Cr) is also assessed unchanged from 13 Feb’15 at 81-82 cents/lb, CIF China amid an absence of deals and offers and limited spot Indian-origin material available for sale.
An Indian producer said his Chinese customer was interested in procuring Indian Ferro chrome at 81.5 cents/lb, CIF but his company was looking for at least 84 cents/lb, CIF.
Most sources were circumspect about the market’s prospects in March. The outlook for March may not be good, assessed SteelMint, looking at recent falls in stainless and carbon steel prices.
An Indian producer remarked, “Ferro chrome prices are unlikely to rise in March.” He was more hopeful of an increase in the second quarter but said it would depend on the stainless steel market.
Exchange Rate : USD 1 = INR 62.26
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