Chinese high-carbon ferro chrome prices inched up by RMB 100/t ($14/t) w-o-w, while medium-carbon ferro chrome prices remained unchanged.
Prices of various grades were:
- High-carbon ferro chrome: Prices were at RMB 8,750-8,950/t ($1,211-1,239/t) up by RMB 100/t ($14/t).
- Medium-carbon ferro chrome: Prices hovered at RMB 13,700-13,800/t ($1,892-1,906/t). All prices are ex-works and include taxes.
Factors influencing market:
Rising input costs support prices: This week, escalating prices of essential raw materials such as chrome ore and coke have stirred activity in China’s ferrochrome market. The ongoing Red Sea crisis has prompted many international shipping firms to announce price hikes for May, elevating import costs for chrome ore traders. With these increased expenses unlikely to abate soon, market observers anticipate continued stability in chrome ore prices despite the shipping challenges.
Dull stainless steel market: The downstream stainless steel market showed signs of weakness amid average trading activity and performance. Despite modest demand, recent improvements in ferro nickel, electrolytic nickel, and high-carbon ferro chrome prices have bolstered the cost side, providing support for stainless steel. This cost-driven momentum has deterred low-price sales in the market.
Meanwhile, the current landscape is marked by a deadlock between steel mills and producers. Despite rising input expenses, steel mills are cautious about raising their bids for ferro chrome. The reluctance of steel mills to raise bids suggests potential concerns about demand or a wait-and-see approach. Conversely, producers face increasing pressure from rising input costs, potentially leading to future price adjustments.
Outlook
China’s ferro chrome market exhibits a temporary stalemate. While upcoming production restarts and potential new projects signal future supply increases, steel mills are maintaining average restocking levels, reflecting subdued demand. This weak demand restricts price hikes, but high production costs for manufacturers limit significant price drops as well.
This scenario suggests short-term stability; however, close monitoring of both supply additions and steel mill restocking activity is crucial to predict future price trends.
Note: This article has been written in accordance with an agreement between CBC and BigMint.