- Chrome ore availability might ease in domestic sector
- Vedanta-FACOR’s auction postponed until further notice
Prices of Indian high-carbon ferro chrome (HC60%, Si:4%) decreased by INR 4,000/t ($48/t) w-o-w in comparison to the previous evaluation on 6 March. Prices dropped as negotiations progressed and with drop in offers, deals were concluded.
High-carbon ferro chrome (HC60%, Si:4%) was assessed at INR 116,000/t ($1,400/t) exw-Jajpur by BigMint on 13 March. The index has hit two-month lows and deals were concluded at INR 115,000-116,000/t ($1,388-1,400/t). Around 2,000 t of trades were completed.
Furthermore, on 14 March, prices of high-carbon low-silicon ferro chrome (HC60%, Si:2%) dropped by INR 2,300/t ($28/t) w-o-w.
Market insights
Buyer reluctance pushed down offers: Ferro chrome prices rose following OMC’s auction, mostly as a result of increasing production costs. However, as days went by and buyers were hesitant to procure material, offers decreased. In the previous week, as prices came down, deals were concluded at the lower end of the price spectrum. However, price sustainability is yet to be seen as some are expecting it to go down even further.
Also, producers may rely on Tata Steel in addition to OMC because the former has announced resumption of its chrome ore mining. Numbers indicate that it has, in fact, returned to full capacity mining.
Navigating China’s market: Ferro chrome (HC60%) prices in China saw a little drop of RMB 50/t ($7/t) w-o-w to RMB 8,850/t ($1,230/t) exw-Inner Mongolia.
“Chinese spot prices in the next 7-10 days will determine the tender prices for next month and there might be a slight increase,” a significant Indian producer who mostly serves the export market told BigMint.
There have also been reports of rising chrome ore prices in China, which could contribute to price increase.
Stainless steel trends: Prices of the 304 grade stainless steel held steady w-o-w at INR 180,000/t ($2,172/t) exw-Mumbai. Due to lower import costs, demand remained down, and for the 200 series, demand was similar primarily because the financial year conclusion approached. The sector’s outlook showed optimism mainly due to price increase by a major flats producer.
Outlook
Based on market trends over the previous few weeks, BigMint estimates prices may experience further correction. Vedanta-FACOR’s ferro chrome auction which was scheduled on 13 March has been postponed. Also, market sources are awaiting OMC’s chrome ore auction which is likely to be scheduled next week. The outcome of this might throw some light on the price dynamics.