China's ferro chrome prices inch up amid rising raw material costs

Ferro chrome prices in China have inched up by RMB 100/t($14/t) for both the grades, as the raw material prices saw an upper momentum. Prices of various grades were:

High-carbon ferro chrome: Prices were at RMB 8,850-9,050/t ($1,248-1,267/t).

Medium-carbon ferro chrome: Prices hovered at RMB 13,800-13,900/t ($1,946-1,960/t). All prices are ex-works and include taxes.

Strong raw material prices: Ferro chrome prices climbed this week due to rising production costs. Gains in the chrome ore market, driven by both recent spot prices and higher long-term contract costs (potentially due to resource scarcity), prompted ferro chrome producers to raise their selling prices. Expect this upward trend to hold unless the chrome ore market changes or alternative production methods emerge.

Stainless steel market exhibits mixed signals: The stainless steel market showed mixed signals. Spot prices are stable, but futures prices have dipped, suggesting some caution. Despite this, merchants are surprisingly optimistic, hinting at potential future demand growth or production cost stability.

Rising ferro chrome supply on the horizon: The ferro chrome market may see a significant supply increase in the near future. Southern plants are set to resume production, and new projects in the north are nearing completion. This could put downward pressure on prices in the medium to long term.

Outlook

In essence, the ferro chrome market faces a potential price correction due to an upcoming supply increase. Producers need to be strategic and monitor market developments closely to adapt their operations accordingly.

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