China: Ferro chrome prices hold steady w-o-w despite weak downstream demand

• Chrome ore market struggles, sees discounted sales

  
  
  

• Stainless steel suppliers cut output on weak demand
  
  

CBC: China's ferro chrome market remained stable, with prices of high- and medium-carbon ferro chrome unchanged w-o-w. Supply from southern steel mills decreased, while limited market activity persisted amid weak demand from the stainless steel segment.

Prices

High-carbon ferro chrome: Prices were unaltered w-o-w at RMB 6,900-7,300/t ($949-1,004/t).

Medium-carbon ferro chrome: Prices were unchanged w-o-w at RMB 11,800-12,000/t ($1,623-1,650/t) exw, including taxes.

Factors driving market

Chrome ore market struggles amid weak demand: The chrome ore market remained weak, with domestic spot prices fluctuating within a narrow range. Foreign futures prices of chrome ore from Turkiye, Albania, Iran, Zimbabwe, and Pakistan also remained subdued.

The ongoing weakness in the downstream ferro chrome market exerted pressure on chrome ore prices. While supportive sentiments among futures and spot traders helped prices remain steady, the broader market downturn persisted. Capital turnover concerns and the risk of further price declines led to discounted selling in the market.

Supply-demand gap impacts stainless steel market: Stimulated by domestic quantitative easing policies, the stainless steel market initially trended up, but the underlying issue of supply-demand imbalance remained unresolved. This week, subdued demand continued to create a negative market atmosphere, leaving the supply side with no choice but to reduce output.

With little improvement expected in downstream demand, price pressure will likely persist, ultimately impacting the mining sector, as lower demand leads to continued strain on prices.

Outlook

The ferro chrome market is likely to experience small adjustments in the short term, with cautious trader behaviour, steady inventory levels, and limited impact from the current chrome ore supply.