China’s Baosteel, one of the major players in the global stainless steel industry, has raised the purchase price of high carbon ferro chrome by 1300 Yuan (USD 188.64) M-o-M to set it at 10,800 Yuan (USD 1566.40) per tonne for Dec’16. The sharp rise in purchase price in the last few months can be attributed to the tight supply scenario and soaring Chrome Ore prices in China, which in turn increased the spot prices of high carbon Ferro Chrome.
Most market sources are of the view, that the primary reason for such a surge in prices of ferro chrome is due to hike in production cost of the same. Furthermore, it has been observed that the Chinese were scrambling to buy Ferro Chrome from India, and were ready to pay a huge premium for prompt deliveries, amid high price levels of chrome ore. Ferro Chrome demand is expected to be firm atleast until the Chinese New Year.
South Africa and Turkey being the major exporters of Chrome Ore to China increased their prices due to huge demand. The raise in purchase price of ferro chrome by Baosteel are in line with market expectations. SteelMint assessed that this could further and went upward for December delivery which has been announced today.
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