Indian Ferro Chrome producers were encouraged to raise their offers as demand from China gets stronger amid production cuts during environmental checks.
There has been a sharp rise in prices of stainless-steel in China on supply crunch as the output of the commodity was down due to its low prices.
Similarly, Ferro Chrome market also witnessed a supply crunch as its production was curtailed due to low realization rate as Alloy prices were down but Ore prices were firm.
“The rise in stainless-steel prices is likely to soften its pressure on HC Ferro Chrome,” said a producer source. But on the other hand, reduced output by stainless-steel mills will affect the demand for HC Ferro Chrome, he added.
Recently, the major stainless-steel producers like Baosteel and Tsingshan raised their tender price by a mere 200 RMB for June’18 and at the same time also some downstream buyers do not see any convincing reason for the price hike for HC Ferro Chrome.
SteelMint assessed Ferro Chrome prices at 87 cents/lb CIF China, 91 cents/lb CIF Korea and 92 cents/lb CIF Japan. However, Indian producers are offering at higher levels but no such deals are heard to have taken place.
Although most Ferro Chrome producers have expressed their reluctance to scale down the offers after the lower-than-expected increase in the tender price for June, these tender prices will, however, will be the reference point for spot offers.
The demand for Ferro Chrome in the domestic market is healthy and prices are assessed at INR 78,000/MT (Ex-Odisha) but the producers have started offering at higher levels.
On the future outlook, many market participants predict the Ferro Chrome prices have touched the ceiling and will be on a stable track on the short-term.
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