- Bid prices drop m-o-m in OMC’s chrome ore auction
- Tsingshan, TISCO reduce August tender prices
Indian high-carbon ferro chrome (HC60%, Si:4%) prices inched down further by INR 900/t ($11/t) w-o-w as compared to the previous assessment on 17 July. Prices dropped as market conditions remained subdued and bid prices also dropped m-o-m in OMC’s chrome ore auction.
Price trends
Domestic: Indian HC ferro chrome (HC60%, Si:4%) prices were at around INR 107,900/t ($1,289/t) exw-Jajpur, as per BigMint’s assessment on 24 July. Around 1,100 t of trades in the INR 106,000-108,000/t ($1,266-1,290/t) exw price range were reported to BigMint last week.
High-carbon low-silicon ferro chrome (HC60%, Si:2%) prices remained steady with a slight w-o-w drop of INR 200/t ($2/t) to INR 114,000/t ($1,362/t) exw-Jajpur. Approximately 400 t of deals were carried out for it within INR 114,000-115,500/t ($1,362-1,380/t) exw.
Low-carbon (C:0.1%) ferro chrome prices experienced a marginal fall of INR 300/t ($4/t) w-o-w to INR 224,200/t ($2,678/t) exw-Durgapur on 25 July.
Export: Export prices to China and Japan came down by a nominal 0.5 cents/lb w-o-w to 98 cents/lb and 102.5 cents/lb , respectively on CNF basis. Sources claimed that there was lower demand for stainless steel in both the nations.
Factors weighing down Indian ferro chrome prices
Bids fall m-o-m in OMC’s chrome ore auction: The entire 65,700 t of material were sold out in the chrome ore auction held by OMC on 20 July. But in comparison to the June auction, bid prices dropped by INR 388-3,085/t (3-14%). However, premiums of INR 100-16,600/t (1-77%) were achieved over the base prices.
A market participant recently told BigMint, “Prices might remain under pressure because the majority of small producers along with a major one have sufficient inventories.”
Decline in China’s monthly ferro chrome tender prices: Two of the major producers of stainless steel in China, Tsingshan and TISCO, reported a m-o-m decrease of RMB 100/t ($14/t) for their August tender prices at RMB 8,895/t ($1,231/t) and RMB 8,695/t ($1,203/t), respectively. Increased domestic production and availability may be the cause of the price decline.
Domestic prices (HC60%) stayed steady w-o-w at RMB 9,000/t ($1,245/t) exw-Inner Mongolia. Prices did not drop because the costs of UG2 chrome ore remained stable.
One of the overseas market participants reported to BigMint: “The demand for standard stainless steel (SUS) is weak in Japan and China. Prices for stainless steel grades 304 and 430 remain stable with no significant changes. Additionally, UG2 ore prices are under pressure. Price decreases in Tsingshan and TISCO’s tenders have led to a drop in ferrochrome prices, with expectations of an under-pressure market.”
Stainless steel prices inch down in India: Stainless steel prices for 304 grade HRC fell slightly by INR 1,000/t ($12/t) w-o-w to INR 176,000/t ($2,103/t) exw-Mumbai. A little decline in LME nickel prices prompted this fall.
The 2.5% import duty on ferro nickel was removed in the recent Union Budget as well, which could reduce production costs.
Outlook
Recent trades indicate that prices are facing a downward pressure, so there’s a possibility of further price correction in the days ahead.
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