Indian Ferro Chrome prices went further down by INR 1000/MT and sunk to three years low. Producers were already depressed with the falling prices of Ferro Chrome, and this has made them pessimistic. Producers feel that there is no hope for prices to get into the positive trend near time soon. Moreover, they fear the availability of ores and are certain that the prices for Chrome ore may further increase. There is a downbeat running in the whole Ferro Alloy market, the producers are anxious as they see hope until severe production cuts hit the market. While the prices in the domestic market are at INR 60,000/MT, many Ferro Chrome manufacturers are restraining themselves from selling any further material. However, shutting down is not an option as the restarting cost would be much higher than the losses currently incurred and therefore, the production needs to be continued. With the recent news of OMECL reserving rights for TATA’s Sukinda mines, Ferro Chrome producers are anxious about the availability as it is highly anticipated that a state-owned company would not be as efficient as TATA Steel in producing Chrome Ore. Meanwhile, the reduced purchase tender prices by Chinese Stainless steel is an added stress on the Indian market. With such disruptions in the market, some Ferro Chrome Producers are switching to other commodities like Manganese Alloys and hope for returning when production is viable.
In the export market, the prices fell in line with reduced demand and thin trading activities. Offers for CNF South Korea (10-50 mm, HC 60%) is at around 68 cents/lb, CNF Japan (10-50 mm, HC 60%) is at 69 cents/lb and for China, the prices are at around 64 cents/lb CNF. The export market remains dull with the down-trending stainless steel market.
Chinese Market:
Prices for Ferro Chrome in the Chinese Spot market has been falling continuously since the tender prices were released for December. Traders in the Chinese market are in a view that this is probably not a suitable time to prepare stocks, due to the prevailing sluggish operations and the bearish attitude of the Ferro Chrome market. Therefore, the intention of buying is weak.
On the future outlook, the Ferro Chrome market may continue the bearish sentiments. Although many producers feel that the prices may not go low, however, there is no end to the falling prices till successful negotiation happens.
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