China: Ferro chrome prices inch up w-o-w on firm chrome ore prices

• Spot activity remains subdued in ferro chrome market
• Rising smelting costs underpin Inner Mongolia prices

Ferro chrome prices inched up across all grades this week. High-carbon (Cr 50%, C 68%) rose by RMB 100/t ($14/t) to RMB 8,590-9,000/t ($1,238-1,297/t) ex-works, including taxes.

Medium-carbon (Cr 60%, C 1%) also gained RMB 100/t ($14/t) to RMB 13,000-13,200/t ($1,874-1,903/t), while low-carbon (Cr 60%, C 0.1%) increased by RMB 100/t ($14/t) to RMB 13,700-14,000/t ($1,975-2,017/t), all exw and including taxes.

Ferro chrome prices inched up during the week supported by firm chrome ore costs and rising smelting expenses, while spot market activity remained slow as buyers awaited guidance from major mills.

Market updates

Raw material market trends

The chrome ore market remained firm, with strong futures prices supporting spot levels. Offers for 40–42% concentrate from major South African mines stayed high, while shrinking port inventories limited selling and led traders to hold prices. Although coking coal prices fluctuated, chromium ore costs remained the main factor driving the market.

In Inner Mongolia, rising smelting costs put pressure on ferro chrome producers, prompting them to maintain price support. In the short term, strong raw material costs continue to underpin ferro chrome prices, though the actual execution of high-priced chromium ore deals was closely monitored.

Downstream market trends

Recovery in downstream stainless steel demand has been gradual, as steel mills continue to work through pre-holiday stockpiles. While production is expected to rise in February, the pace of end-user consumption recovery remains uncertain, reflecting cautious buying behavior from downstream consumers.

In the ferro chrome spot market, activity remained subdued, largely focused on fulfilling pre-holiday contracts with limited new orders. Bidding from mills progressed slowly, as market participants awaiting clear price guidance from major mills, keeping both supply and demand in a cautious, wait-and-see mode

Outlook

Ferro chrome prices are likely to remain range-bound in the near term, supported by strong ore costs, while the slow recovery in downstream demand may limit sharp gains.

(With inputs from CBC)