INDIA: Ferrochrome market on a bull run

Indian ferrochrome market seems to witness a bull run in Feb 2013 with prices reaching at all time high.

Ferrochrome prices have shown a steep rise of Rs 8,000/MT on
an m-o-m basis. Market players attribute short supply of chrome ore, the key
raw material for ferrochrome to be the main reason behind the sharp rise in
prices.

Ferrochrome HC 60% in December 2012 was traded at around Rs
64,000-65,000/MT. But currently, manufacturers are quoting the same grade at as
high as Rs 72,000- 73,000/MT.

According to a manufacturer for ferrochrome based in Kolkata,
“There is shortage of chrome ore from Odisha as few private mines are not operating.
As a result, production of ferrochrome has fallen by 50% & the shortage of
ferrochrome has lead to a sharp rise in its prices. If the situation remains
same in the coming weeks then it would not be surprise if prices reach Rs
78,000/MT for HC FeCr 60%”.

Speaking about the export market, he added, “I have heard
about offers being made at 100 cents/lb CIF China & some deals have taken place
at these rates.”

When asked about the e-auction of chrome ore from OMC, he
said, “OMC will probably go for its next e-auction in last week of March”.