China: Ferro chrome market remains stable amid supply-demand imbalance, downstream weakness

CBC: The Chinese ferro chrome market remained largely stable with minimal fluctuations as weak stainless steel demand continued. Despite lower production costs, oversupply kept steel mills dominant in price negotiations, limiting price increases.

Prices of various grades

High-carbon ferro chrome prices inch down: Prices were largely stable with a slight correction of RMB 150/tonne (t) ($21/t) w-o-w, settling at RMB 8,100-8,500/t ($1,154-1,211/t).

Medium-carbon ferro chrome holds steady: Prices of medium-carbon ferro chrome were unchanged w-o-w at RMB 13,000-13,200/t ($1,853-1,881/t) exw, including taxes.

Chrome ore market maintains stability: Prices of chrome ore remained relatively stable, providing some support to ferro chrome. As domestic chrome ore largely depends on imports, strong prices in foreign markets kept costs elevated. The steeper cost of imported chrome ore propped up the relatively high domestic spot prices, preventing any significant decline in the market despite some sporadic fluctuations.

Slump in stainless steel market continues: The stainless steel segment remained sluggish, with failed futures rebounds and a persistent spot market deadlock. Conditions were overall weak, as terminal demand showed no improvement. Downstream merchants adopted a wait-and-watch approach, driven by heightened risk aversion, leading to transactions mainly on a need-only basis.

Depressed steel prices continue to weigh down the ferro chrome market, which lacks fresh demand drivers. Additionally, bearish sentiments among downstream merchants regarding the future of the market are causing delays in purchasing decisions, further dampening activity.

Outlook

The ferro chrome market is expected to remain stable in the short term, with cautious traders and unclear demand growth. Key factors to watch include the pace of steel mill bidding and the impact of stainless steel market fluctuations on transactions.