China: Ferro chrome prices inch up w-o-w despite weak stainless steel demand

• Weak stainless steel demand limits buying
• Chromium ore prices steady on cost support

Ferro chrome prices remained largely stable for high-grade material in China, while other grades saw modest gains this week.

High-carbon ferro chrome (Cr 50%, C 6-8%) was assessed at RMB 8,590-9,000/t ($1,248-1,307/t) exw, including taxes. Medium-carbon (Cr 60%, C 1%) inched up by RMB 200/t ($29/t) to RMB 13,300-13,500/t ($1,931-1,961/t), and low-carbon (Cr 60%, C 0.1%) gained RMB 100/t ($15/t) to RMB 13,900-14,200/t ($2,019-2,063/t), all exw and inclusive of taxes.

The ferro chrome market remained supported due to high-cost stocks, keeping prices firm despite slower post-holiday demand. Meanwhile, the stainless steel sector demand remained weak, with moderate buying and fluctuating prices ahead of the traditional March peak season.

Market updates

Raw material market trends

The chromium ore market stayed steady, with spot prices holding firm. Overseas mine offers remained high, and suppliers aimed to maintain prices. Despite high port inventories, support from earlier costly stocks kept prices stable.
Pre-holiday stockpiling by ferro chrome plants had been completed earlier, and current procurement has slowed. However, strong cost support underpinned ferro chrome prices, and many miners remained optimistic about the market.

Downstream market trends

The stainless steel market remained weak in terms of both supply and demand. Crude steel production in February fell significantly m-o-m, and steel mills resumed post-holiday operations slowly, limiting demand for ferro chrome.
Stainless steel spot prices fluctuated, inventories rose slightly, and end-user orders were released at a moderate pace. Steel mills mainly purchased raw materials to meet immediate needs, while the market adopted a wait-and-see approach ahead of the traditional peak season in March.

Outlook

Ferro chrome prices are expected to remain stable supported by raw material costs, while limited stainless steel demand may restrict any significant upside.

(With inputs from CBC)