- Elevated chrome ore costs pressure producer margins
- Stainless steel makers adopt strict cost control measures
CBC: Chinese ferro chrome prices held steady w-o-w due to muted downstream demand and cautious purchasing by steel mills. Although there were favourable developments in tariff policies, overall market activity and price growth were subdued.
High-carbon ferro chrome prices edged down by RMB 50/t ($7/t) w-o-w to RMB 7,740-8,150/t ($1,072 – $1,129 /t) exw, including taxes.
Medium-carbon ferro chrome remained unchanged w-o-w at RMB 12,400-12,600/t ($1,717-1,745/t) exw, including taxes.
Market updates
Prices hold firm w-o-w: The ferro chrome market remained stable, with prices holding steady despite some regional differences. Downstream inquiries were limited, and trading volumes remained low, reflecting weak demand.
With stainless steel enterprises extending raw material inventory cycles, cost control measures have become more stringent. This has led to limited acceptance of procurement premiums for high-carbon ferro chrome, thereby restricting the upward potential of ferro chrome prices.
Although the Sino-US tariff policy supported a recovery in the stainless steel market, leading to stronger prices and increased activity, this positive momentum has yet to reach the ferro chrome sector. Steel mills remained cautious, purchasing only on a need basis due to subdued demand.
Chrome ore prices rise: Meanwhile, chrome ore prices remained stable at elevated levels, with tight port inventories sustaining high production costs and continued pressure on ferro chrome producers’ profit margins. As a result, the willingness of some small and medium-sized manufacturers to resume production weakened, leading to a slower pace of raw material replenishment.
Downstream demand remains soft: Downstream steel mills were cautious in procuring ferro chrome, primarily due to weak steel demand. In line with their inventory management strategies, they undertook more rational buying, avoiding large stock replenishments in response to short-term market fluctuations.
Additionally, subdued market expectations for future demand led steel mills to adopt a wait-and-watch approach, awaiting favourable market conditions.
Outlook
The ferro chrome market is likely to remain under pressure in the near term, as traders and downstream buyers adopt a wait-and-watch approach. Despite favourable tariff signals, persistent weak demand and a cautious production outlook are expected to limit price recovery and dampen overall market activity.
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