Prices of High-Carbon Ferrochrome Remained Strong, Otherwise for Low-Carbon

 

[Ferro-Alloys.com]Prices for high-carbon ferrochrome producers remained strong in March, which remained the same during China’s Spring Festival. Domestic supply of high-carbon ferrochrome became sufficient in early March as most producers had finished their production for major stainless steel producers at the end of February, and most ferrochrome producers began to increase their stocks. High-carbon ferrochrome prices in Inner Mongolia remained high in March and was almost the same price in Sichuan and Shanxi, making a loss of price advantage. China’s domestic high-carbon ferrochrome prices have concentrated to the same. In the meantime, domestic prices of low-carbon ferrochrome can hardly rebound as price from China’s largest producer remained the lowest since 2014 due to high inventory and weak demand.

 

TISCO increased its high-carbon ferrochrome tender price in March, which brought an expectation of a rise in China’s domestic chrome market. China’s major stainless steel makers, including Baosteel, JISCO, and Tsingshan, released their tender prices for high-carbon ferrochrome for April in the end of previous month. To the disappointment of the chrome industry, all of the three failed to increase their tender prices. Baosteel and JISCO made rollovers from their previous tender prices, while Tsingshan lowered its tender price and cut its purchasing amount, which made a same tender price for the three. China’s major stainless steel makers’ tender prices bottomed in Oct-Nov 2014 and began to rebound in the coming months, and the decline in Tsingshan’s tender price in April brought uncertainty to the rebound. The new tender prices ceased to rebound in April, one is because of the declining stainless steel price in China, which made the major purchasers refuse to increase their purchasing prices, even though the AIIB and “one belt one road” brought optimistic expectation for the stainless steel prices. On the other hand, the arrival of rainy season in South China would cut the local power prices sharply, which would increase the supply of high-carbon ferrochrome as most producers would resume their productions. Meanwhile, the China’s monthly import of high-carbon ferrochrome created a history high in February, reflecting that the stainless steel makers tended to use more cheaper imported high-carbon ferrochrome, which adds more pressure for China’s domestic high-carbon ferrochrome prices. 

 

South Africa Origin Chrome Ores still in Great Demand

 

Chrome ore market turned active as most ferrochrome producers began their purchases after Chinese New Year. South Africa origin chrome ore concentrate is the most welcome one in the chrome ore market. More and more ferrochrome plants use South Africa origin chrome ore concentrate as their raw material to lower their production costs, which increases the demand for the ore greatly. But it is otherwise for other chrome ores. Chrome ores prices remained stable except that there is a slight increase for South Africa origin chrome ores. As the ferrochrome production rate rise, the demand for chrome ores would increase accordingly, which would make a more active chrome ore market in April.According to China Customs data, China imported around 0.63 million tonnes of chrome ores in February, down 17.3% from the previous month, reflecting that chrome went to China more by ferrochrome than by chrome ores in previous months.

 

Market Outlook

 

As the rainy season in South China gets closer, domestic ferrochrome production rate would rise accordingly, which would bring a more prospective chrome market in China. The imported chrome ores would increase month by month. The high-carbon ferrochrome prices are likely to continue to rebound as the stainless steel prices would bottom. On the other side, China’s chrome market is facing the intrude of imported ferrochrome with its more competitive prices.

 

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