The sharp climb in ferro chrome prices continued and sentiment remained bullish as Indian producers are not faced with any selling pressure.
SteelMint weekly assessment for grade 60% is in the range of INR 103,000/MT (Ex-Odisha). However, few producers were also heard to be quoting at much higher prices for small quantities, as material remained in tight supply. Demand from the domestic market is subdued due to high prices and the higher offers are not finding acceptance any more. Though there has been a substantial rise in demand for Indian Ferro Chrome from China as the production cost of the material in China is still on the rise and the purchase tender price for Dec’16 by steel mills is also likely to rise substantially. As a result the Chinese are expecting Ferro Chrome spot prices to increase, and are scrambling to buy Ferro Chrome from India fearing the price rise could further intensify.
Indian producers are also relieved by the lower than expected ‘Base Price’ set by OMC for its next round of Chrome Ore e-auction to be held on 26 Nov’16. For example, base price for 48/50% grade friable chrome ore is kept at INR 12,757/MT. Tata Steel in conversation with SteelMint expressed astonishment and revealed that they have already concluded a deal for Chrome Concentrate (48-50%) at INR 19,500/MT.
Few Indian producers of Ferro Chrome are also holding back sales to the coming week, and not concluding deals with China due to upward expectation of prices amid limited stocks in China and high possibility of rise in purchase price by Chinese Stainless Steel mills.
Spot price of imported High Carbon Ferro Chrome into China was steady this week. Indian-origin High Carbon Ferro Chrome (58-60% Cr) was assessed at 120 cents/lb CIF China for January delivery.
SteelMint assessed that Chinese High Carbon Ferro Chrome prices will rise further in the near future, in view of tight spot supply and soaring Chrome Ore prices.
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