China: Ferro chrome prices remain largely stable despite subdued demand

• Prices ease slightly w-o-w across grades
• Rising supply expectations continue to pressure market sentiment

High-carbon ferro chrome (Cr:50%, C:6-8%) prices in China edged down w-o-w to RMB 8,340-8,750/t ($1,223-1,284/t) from RMB 8,390-8,800/t ($1,231-1,291/t). Medium-carbon (Cr:60%, C:1%) prices eased slightly to RMB 13,200-13,400/t ($1,937-1,9666/t) from RMB 13,300-13,500/t ($1,951-1,981/t), while low-carbon (Cr:60%, C:0.1%) prices also softened to RMB 13,800-14,100/t ($2,025-2,069/t) from RMB 13,900-14,200/t ($2,040-2,083/t), exw including taxes.

China’s ferro chrome market remained weak but largely stable as chrome ore costs and freight rates continued to provide support, while sluggish downstream demand and expectations of higher domestic and overseas supply weighed on market sentiment.

Market updates

Supply pressure and high inventories weigh on market

Market sentiment remained cautious amid expectations of higher ferro chrome production in China and rising overseas supply from South Africa and Zimbabwe. Anticipated production recovery in southern China and expectations of increased imports continued to pressure spot prices.

Meanwhile, chrome ore prices remained relatively firm due to stable overseas offers and elevated freight costs. However, high port inventories and increased selling pressure weakened raw material support marginally, limiting further upside in ferro chrome prices.

Weak steel procurement limits market recovery

Downstream stainless steel mills maintained cautious procurement despite stable production and improved steel margins. Mills continued relying on existing inventories and purchased mainly for immediate requirements, resulting in subdued transactions and weak bidding activity.

Although phased procurement from carbon and special steel mills may provide limited support, sluggish end-user demand and rising supply expectations continued to cap any meaningful recovery in ferro chrome prices.

Outlook

China’s ferro chrome prices are expected to remain range-bound with a weak bias in the near term. Firm ore costs may continue to provide downside support, while rising supply expectations, high inventories, and cautious downstream procurement are likely to limit upward momentum.

(With inputs from CBC)