Indian ferro chrome prices are marginally lower than the previous week amidst a supply-demand mismatch. Producers with higher inventory are desperate to liquidate the stock to mitigate the cash flow crunch. Meanwhile, suppliers with stable long-term contracts in hand are firm with their offers.
- Domestic Scenario
Currently, prices are hovering at around INR 66,000-66,500/t in Ex-Jajpur. Meanwhile, in Durgapur, producers are offering at INR 1,000/t higher than Jajpur levels. However, in Jajpur a deal was heard to be concluded at INR 65,000/t, to alleviate the liquidity crisis faced by the company, but this might lead to further correction in prices in the domestic market. - Export Market
For exports, the spot market remains near to absent from China, which is the major market for the Indian ferro chrome exporters. Chinese buyers remain cautious about imports as they believe that the prices will fall further in the December round of tenders for purchase of ferro chrome by the Stainless-steel mills.
Currently, the price assessments are at cents 69/lb for CNF China, but the inquiries are at cents 66/lb which is halted export deals. Meanwhile, the landed price for South Korea and Japan are at cents 70/lb and cents 71/lb respectively. - Chinese Market
Chinese ferro chrome imports keep declining every month due to limited buying tendency and higher in-house production. However, the situation is not expected to improve as the production volume of China is expected to increase by further 2 mn t by the next year. Meanwhile, due to lower Stainless-steel prices in China, it is expected that the stainless mills will reduce the prices of ferro chrome by RMB 50 or more, which is going to have a further negative impact on the Indian ferro chrome prices. - Chrome ore market
India now has an abundant supply of chrome ore as Tata Steel Mining Ltd (TSML) is also supplying ore in the market along with Odisha Mining Limited (OMC) to the domestic chrome alloy producers. TSML is maintaining price parity with OMC for the sale of chrome ore in the market. It is expected that the prices of chrome ore will also come down as the supply issues are resolved and looking at the lacklustre ferro chrome market. - Outlook
Ferro chrome prices are expected to fall further as the pessimistic approach and competition to liquidate stock intensifies in the domestic market.
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