China’s Tsingshan Group, Baosteel and Taiyuan Iron & Steel (Tisco) – the major players in the global stainless steel industry, have all increased their purchase price of high carbon ferrochrome by 200 Yuan M-o-M to set it at around 7,100-7,300 Yuan per metric tonne (equivalent to USD 83-86 cents/lb) for Dec’17.
The slight rise in purchase price comes in line with rising spot Ferro Chrome and Chrome Ore prices in China.
Indian Ferro Chrome Prices Moves Up in Line With Prices in China
India witnessed a rise in Ferro Chrome prices despite the overseas market seeing marginal activity.
“There has been a good demand for the commodity in the domestic market and that has prompted us to increase our prices,” said a source justifying the rise in Ferro Chrome offers. Moreover, he added that the domestic buyers are purchasing to hedge against a further rise in offers after the holidays.
Another source revealed that an anticipatory buying is being witnessed in the market as a precautionary step against a further rise in prices.
SteelMint assessed Ferro Chrome at INR 78,000/MT (Ex-Jajpur), while few producers are also quoting at around INR 80,000/MT.
The overseas market remains quiet amid festive season but the producers are expecting a huge amount of inquiries from China post-holidays.
SteelMint assessed that elevated Chrome ore prices are one of the reasons for a rise in offers. South African Chrome Ore (40-42%) has gone up considerably and is being offered at around USD 200-210/MT CIF China. Most market sources are of the view, that the primary reason for the upward correction in purchase prices of Ferro Chrome is that there is decreasing inventory of Chrome Ore at Chinese ports and also the prices are considerably higher from the beginning of the month, thereby requirement to procure Ferro Chrome is much higher.
Ferro Chrome export offers are assessed at 90 cents/lb CIF China, 95 cents/lb CIF Japan and 94 cents/lb CIF Korea. However, Japan and Korea, wishing to regularize the prices with China are counter-offering in range of 90-91 cents/lb, which has been reportedly denied by Indian producers as selling in the domestic market will be more beneficial to them.
SteelMint assessed that a recent increase in tender prices by Chinese stainless steel giants will also support the higher Ferro Chrome offers post vacations.
On the future outlook, market participants are of the bullish view that Ferro Chrome offers will witness a sharp rise post-holidays.
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