Are Chinese Ferro Chrome Prices Going to Rise Soon?

The confidence of some participants on the prospect of rebounding Ferro Chrome price in China has improved under the support of multiple favorable information, such as the rising price of chrome ore and coke, the northern power-limit situation and environmental supervision. Moreover, an increased electricity cost following the arrival of the dry season in Southern China has also contributed to boost the morale of the market participants. However, it is necessary to pay close attention to the new round of steel tender for a clearer direction.

The mainstream quotation of HC Ferro Chrome is assessed between RMB 6,900-7,100/MT (USD 996-1025/MT), with little change compared on weekly basis. Currently, in the second-half stage of this month, the wait-and-watch mode in the industry has caught on before the release of the new round of tenders, hence, weakening the actual operations.

On October 17th, the alloy price index for HC Ferro Chrome 50 basis was assessed at RMB 7,204 (USD 1040) in Hebei area; RMB 7,274 (USD 1050) in Shandong area; RMB 7,843 (USD 1132) in Liaoning area; RMB 7,411 (USD 1070) in Jiangsu area; RMB 7,426 (USD 1072) in Sichuan area; RMB 7,480 (USD 1080) in Hunan Province;

Low-carbon Ferro Chrome 60 basis (delivered, including tax): RMB 12,855 (USD 1855) in Hebei Province; RMB 12,963 (USD 1870) in Shandong area ; RMB 13,103 (USD 1890) in Liaoning area ; RMB 13,151 (USD 1898) in Jiangsu area ; RMB 13,154 (USD 1898) in Sichuan area.

Chrome Ore Market

Under the support of increasing market inquiries and further consumption of stocks, the price of chrome ore has witnessed a slight uptick. Though the port ore price remains firm, traders ‘ willingness to back the price stays unchanged. Chrome Ore export offers to China from South Africa for UG2 grade chrome ore is as high as USD 175/MT CIF.

Stainless Steel Market

The long-settled 304 stainless steel market is facing a dilemma due to rising cost coupled with selling pressure which forced the sellers to lower their offers by RMB 50-100/MT (USD 7-14).

In Wuxi market, the price of cold-rolled sheet 304 of four-foot cutting edge by ZPSS is RMB 16,050/MT (USD 2316), the base price of four-foot cutting edge by Jiu steel and Tisco are reported at RMB 15,850/MT (USD 2287), while the same by Hongwang, Chengde is reported between RMB 15,400-15,500/MT (USD 2222-2236), and Yongjin at RMB 15,500-15,600/MT (USD 2236-2251). Price of hot-rolled sheet 304 of the five-foot raw edge by Guangqing, Dongte, Chengde stood at RMB 14, 750-14,850/MT (USD 2129-2143).

Future Outlook

In the short term, the HC Ferro Chrome market may continue to maintain stability as abrupt fluctuations are unlikely to happen. However, due to the pressure of funds at the end of the month, it is possible that some companies choose to lower the price. Moreover, it is necessary to beware of the negative impact brought about by the weak stainless steel market.