- High-carbon grade rises amid port strike, logistics costs
- Demand from stainless steel mills remains sluggish
CBC: Chinese high-carbon ferro chrome prices inched up w-o-w amid tight ore supply following the South African port strike and rising logistics costs. Meanwhile, low-carbon ferro chrome experienced strong demand from the new energy battery segment, though tight supply constrained availability. However, market sentiment remained cautious overall, with trading focused on long-term positions and limited speculative activity in the spot market.
High-carbon ferro chrome prices went up slightly by RMB 350/tonne (t) ($49/t) w-o-w to RMB 8,090-8,500/t ($1,131-1,188/t) exw, including taxes.
Medium-carbon ferro chrome prices edged up by RMB 100/t ($14/t) w-o-w to RMB 13,200-13,400/t ($1,845-1,873/t) exw, including taxes.
Market recap
Delivery costs climb up amid logistical issues: Tight chrome ore supply remains a key concern. A two-week strike in South Africa has caused record port backlogs, prompting domestic producers to rely more on Turkish ore, though longer shipping times increased inventory risks.
Xinjiang’s epidemic control measures slowed land transport, keeping delivery costs high. Additionally, domestic environmental protection restrictions forced some smelters to cut production to meet energy targets, tightening material availability.
High-carbon ferro chrome producers were more sensitive to these raw material fluctuations, while low-carbon producers managed cost pressures through technological optimisation and reduced unit consumption.
Demand from new energy sector grows: High grade ferro chrome consumption was supported by growing demand from the new energy sector, driven by the mass production of iron-chromium flow batteries and hydrogen electrolyser coatings, as well as expanding military and aerospace orders, providing key support for prices.
Demand from the traditional stainless steel sector remained sluggish, while foundry alloy procurement recovered slightly with increased machinery manufacturing orders.
Export demand for low grade ferro chrome rose in Southeast Asia, though margins remained limited. Stainless steel mills continued destocking, with large producers primarily focusing on depleting existing inventories, keeping market trading subdued.
Outlook
In the short term, ferro chrome prices will likely remain range-bound, supported by raw material shortages, though limited demand and potential post-strike price corrections may cap gains.
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