Ferrochrome prices slipped again this week with participants holding diverse opinions about the market outlook. Some think that ferrochrome prices may fall further with alloy plants resuming operations and filling up the supply gap. On the other hand, alloy plants are showing reluctance to sell at low prices and are focusing on the delivery of long-term contracts. In the short term the market is rife with pessimistic sentiments.
After the price decline, the mainstream offer is around RMB 8,150-8,300/t ($1,243-1,266/t), as some traders and plants are actively seeking sales to liquidate stocks. With the continuing decline in HC ferrochrome prices in retail markets, ferrochrome manufacturers are short of confidence.
In a holistic view, the output of HC ferrochrome in Apr ’21 is set to expand due to the increased power ration budget in Inner-Mongolia. However, it remains to be seen whether the price of ferrochrome will come under more pressure following the expanded output.
Elsewhere, output in March is about 3.24 mnt, up by 20.8% m-o-m and up by 30.8% y-o-y and the production schedule for Apr ’21 is maintained at high level. Though the ferrochrome output is improving, the actual supply is not excessive while demand remains robust.
The designated team on resolving obsolete capacity in Inner-Mongolia’s Ulanqab city issued notice involving 29 alloy plants of which 19 are ferrochrome plants with 31 furnaces totalling 770,000t capacity.
Chrome Ore
Meanwhile, the Chrome ore market is also softer, as chrome concentrates 48-50% of Turkey origin decreased by $10/t, while lumpy ore of Iran origin 40-42% slipped by $5/t. Although most chrome ore suppliers have not taken action to lower their offers, their anticipation has softened.
At present, most participants choose to offer at the same level that prevailed prior to the holiday and temporarily keeps them unsold while monitoring the operation recovery of alloy plants in Inner-Mongolia and the market dynamics. In the short term, the offers from both overseas and domestic market will struggle to hang stable, though some transactions at Tianjin port is lowered to RMB 28/t for concentrates 42-40 of SA origin and transactions are tepid due to the weak demand from alloy plants.
Prices in different regions: HC ferrochrome 50% basis, delivered including tax;
Hebei province: RMB 8,485 ($1,294) down by RMB10/t; Shandong province: RMB 8,514 ($1,298), Liaoning province: RMB 8,703 ($1,327) up by RMB10/t; Jiangsu province: RMB 8,661($ 1,321), Sichuan province: RMB 8,406 ($ 1,282), Hunan province: RMB 8,480 ($ 1,293) down by RMB 10/t.
Stainless Steel
The stainless steel market has grown despite somewhat cautious trading sentiments. Transactions improved to some degree backed by the inclination of pursuing an upward trend. The mainstream offers for four-foot cold rolled ss of 304 series with raw edges are at RMB14,900-15,500 ($ 2,272-2,363) amongst private producers and prices hiked by RMB 50-100 on different types starting from two days ago, though actual deals are still open for negotiation.
The hot rolled ss plates of private producers on Guangdong’s Foshan and Jiangsu’s Wuxi markets are basically maintained at RMB15,300-15,600 ($2,333-2,378) while future deliverables of Tsingshan have been held down at a low level and its agents have no notable willingness to hike the prices with most raw-edge type offered at RMB15,250-15,400 ($2,325-2,348). Spot sellers opt to conclude more sales over worries of en-route consignments.
Leave a Reply