High-carbon ferro chrome prices remained within the range of RMB 8,600-8,800/t ($1,195-1,222/t), while medium-carbon prices experienced a minor decline of RMB 100/t ($14/t) to settle around RMB 14,200-14,300/t ($1,972-1,986/t). All prices are inclusive of tax and ex-works.
Factors driving consistency in Chinese ferro chrome prices were:
Higher operational costs: Ferro chrome market reflected consistency, with an average trading atmosphere and transaction performance. Despite fewer inquiries from the downstream ferro chrome market, plants were reluctant to offer price discounts due to the high operational costs of raw materials.
It was worth noting that Shanxi Taigang and Tsingshan Holding Group have maintained the same bidding price for high-carbon ferro chrome in March 2024 as in February.
Consistent chrome ore prices: The market for chrome ore showed stability recently, with an average trading atmosphere and transaction performance. There have been numerous transactions in the chrome ore futures market, particularly focusing on South African resources, leading to price increases. This has prompted chrome ore spot traders to express support for prices.
However, despite this positive trend, downstream ferro chrome steel bidding prices have remained flat, resulting in challenges for ferro chrome plants in terms of profitability. As a result, their acceptance of high-priced raw materials has been limited, contributing to the temporary stability of chrome ore prices.
Wait-and-watch approach in stainless steel market: The downstream stainless steel market indicated consistency, with an average trading atmosphere. Despite recent rapid price increases, downstream merchants were hesitant to accept high-priced spot goods. While there have been inquiries indicating a desire to lower prices, actual orders have been limited. Spot merchants are reluctant to adjust prices due to delivery costs and adopted a wait-and-see approach to stabilise prices.
Outlook
China’s ferro chrome prices displayed a skeptic outlook. While positive signals exist, such as increased futures activity and supportive sentiments from spot traders, the weak downstream demand and unprofitable production of ferro chrome created counteracting pressure. Further observation is necessary to determine the market’s future trajectory.
Note: This article has been written in accordance with an agreement between CBC and BigMint.