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China: Ferro chrome prices decline on resistance to higher offers

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Ferro Chrome
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31 Jul 2024, 16:52 IST
China: Ferro chrome prices decline on resistance to higher offers

CBC: The ferro chrome market witnessed persisting weakness, with manufacturers facing pressure from both ends. High chrome ore prices have raised production costs, while intensified bidding pressure from downstream steel mills has worsened the situation.

Prices of various grades:

High-carbon ferro chrome: Prices declined by RMB 200/t ($28/t) w-o-w to settle at RMB 8,400-8,800/t ($1,161-1,216/t).

Medium-carbon ferro chrome: Prices of medium-carbon ferro chrome fell by RMB 200/t(28/t) w-o-w to RMB 13,300-13,500/t ($1,838-1,865/t). All prices are ex-works and include taxes.

Factors driving the market

Dull chrome ore market: The chrome ore market was weak, with a generally subdued trading atmosphere. Despite miners' firm quotations, downstream buyers were resistant to high prices, primarily purchasing only for essential needs. The industrial chain is in a stalemate, with a prevalent wait-and-see sentiment among participants.

This situation reflected the cautious approach of market players, balancing firm supply-side pricing against tepid demand and limited willingness to engage in significant transactions.

Downward stainless steel market: The downstream market remained sluggish w-o-w. Terminal demand also fell, leading downstream merchants to adopt a wait-and-see approach and increase risk aversion. Most transactions were driven by essential needs.

The decline in Shanghai nickel and stainless steel prices has made merchants bearish about the future, causing them to postpone purchases. Traders note that the market was in a bargaining phase, and price stability remained crucial for maintaining confidence.

Outlook:

Currently, downstream steel mills show limited stocking interest, and the ferro chrome market relies mainly on rigid demand with weak support. Despite high production costs for ferrochrome manufacturers preventing significant price reductions, poor off-season demand and falling raw material costs have weakened price support. There remains a potential risk of further price decline in the near term.

Note: This article has been written in accordance with an agreement between CBC and BigMint.

31 Jul 2024, 16:52 IST

 

 

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