Indian Ferro Chrome prices correct upwards as market witnesses healthy demand and short supply in China.
Demand from China has been constant but a tight supply situation in the country due to production cut has propelled the prices of Ferro Chrome.
Although, a limited number of deals have been concluded recently due to Dragon Boat festival in China, but prices have reportedly edged up to 92 cents/lb CIF China. Moreover, the same is expected to climb upwards in the near-term as government environmental policies to curb pollution has resulted in production at low levels, hence creating a supply shortage until supervision in the major producing regions continues.
Mirroring the Chinese market, Japan, and South Korean buyers have also accepted the higher offers. Moreover, the Japanese stainless-steel firms have shown keen interest and are actively buying Ferro Chrome. Export offers are assessed at 97 cents/lb CIF Japan and 95 cents/lb CIF Korea.
The market participants are awaiting the release of European benchmark prices for Q3, which most of them expected to move down, but only marginally due to the current upsurge in Ferro Chrome prices.
The UG2 chrome ore prices have also supported the Ferro Chrome prices wherein it remained firm at USD 210-215/MT due to challenges that the miners are facing in South Africa, including high fuel cost and supply disruption during the winter season.
In line with the Chinese demand, the Indian market also reflects bullishness as sellers have concluded deals at INR 82,000/MT (Ex-Odisha) and are confident about the same to move up in near term. Moreover, few producers are restricting supplies in the market as they are confident of achieving higher prices in the coming days, giving a further impetus to firming of Ferro Chrome prices.
On the future outlook, Ferro Chrome prices are expected to move upwards on supply shortage creating a bullish sentiment among the market participants.
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