- Supply spike offsets increased production costs
- Stainless steel mills cut output amid slow orders
CBC: Chinese ferro chrome prices held steady w-o-w. Rising coke and chrome ore prices provided cost support, but any potential gains were limited by a supply boost from capacity expansions in Inner Mongolia. Stainless steel output cuts offset demand from the new energy sector. The end of environmental inspections eased short-term supply pressure, yet dual carbon policies continued to shape long-term adjustments.
High-carbon ferro chrome prices were unchanged w-o-w at RMB 7,540-7,950/t ($1,051-1,108/t) exw, including taxes.
Medium-carbon ferro chrome prices also remained stable w-o-w at RMB 12,700-12,900/t ($1,770-1,798/t) exw, including taxes.
Market updates
Production costs increase amid higher chrome ore, coke tags: Increased production costs supported ferro chrome prices.Chrome ore prices rose w-o-w but remained volatile, as South African port arrivals improved with logistics recovery, while power rationing in Turkey and currency fluctuations kept import costs elevated.
Inventories at domestic ports remained stable, and some producers turned to long-term contracts to reduce cost pressures. Meanwhile, smelting margins in northern regions narrowed after the third round of coke price hikes.
While southern plants saw better profits, supported by lower electricity rates during the flood season, the proposed export tariff on Indonesian chrome ore has yet to affect spot market prices significantly.
Ferro chrome demand reflects regional disparity: Stainless steel mills in East China reduced ferro chrome purchases due to sluggish orders, while South China’s new energy sector increased stockpiling of high-purity grade material. Some stainless steel mills also witnessed output cuts, straining trade momentum.
Demand for medium- and low-carbon ferro chrome remained stable in the special steel sector, though lower-priced imported alternatives continued to pressure domestic prices. Inventory turnover data indicated that traders were holding stocks for longer periods, reflecting reduced market liquidity.
The adoption of lean inventory and frequent purchasing strategies by end-users led to more fragmented activity in the retail market.
Outlook
In the short term, ferro chrome prices are expected to remain stagnant; however, flat or declining steel prices in August may lead traders to reduce inventories.
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