India: Ferro chrome prices slump amid bearish stainless-steel market

Indian ferro chrome prices fell sharply by INR 5,850/t w-o-w due to weak buying amid production cut by stainless steel mills.

According to SteelMint’s assessment on 9 June, producers are offering ferro chrome in the range of INR 108,000-110,000/t exw-Jajpur.

Factoring weighing on domestic ferro chrome prices-

• Decline in buying interest: Buyers had turned silent after the Vedanta’s auction, which was concluded at lower than market price at around INR 112,000/t on 4 June, as they were anticipating a further fall in prices. Nevertheless, a few buyers who were in immediate need negotiated and booked the material. SteelMint recorded transactions of around 2,000 t this week.
• Bearish stainless steel market: The increase in export duties made exports difficult for stainless steel producers. This resulted in higher inventories, which further lowered prices and forced producers to cut production. 304 grade HRC prices were at around INR 241,000/t, down by INR 4,000/t w-o-w, as per SteelMint’s assessment on 7 June.
• Falling global prices also impacted domestic ferro chrome prices.

China market overview

Chinese ferro chrome market remained slow this week. Ferro chrome (HC60%) prices were at around RMB 9,750/t ($1,459) exw-Inner Mongolia, almost stable w-o-w with a marginal correction. It is expected that the Chinese market will remain under pressure in the short term.

Outlook
Participants expect that Indian ferro chrome market will continue to remain bearish in the near future due to weak stainless-steel sentiment. According to sources, a few buyers are heard to be bidding at INR 106,000/t exw.