Indian ferrochrome prices had skyrocketed amidst rising prices from China. However, domestic buyers have now taken a backseat as they have booked enough for the month and expect the prices to come down in line with retreating Chinese demand owing to the Chinese New Year holidays. Currently, prices of ferrochrome in the domestic market are stable at INR 95,000/t, while many producers are offering much higher than the stated levels. No deals have been concluded at higher levels from Jajpur.
Producers are confident that the prices would be firm on better Chinese demand. Meanwhile, production from China is expected to remain weak due to increased prices of coke owing to low availability. The current prices in Inner Mongolia remain range-bound at RMB 7,800-8,000/t, with no changes since last weekend.
Though demand from domestic market remained on the downside, export demand has picked up from China before their holidays. Many deals were concluded at cents 99-100/lb CNF China this week and this has further boosted the confidence of the producers for being firm in their offer prices. Meanwhile, demand from South Korea and Japan remained healthy in the week.
Outlook:
The export demand would reduce next week, as the Chinese buyers go for holidays. The export market might be quiet for the next two weeks, giving a strong hand to the domestic buyers in negotiations. Meanwhile, it remains ambiguous whether the producers are willing to lower their prices.
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