Ferro Chrome: Higher Chinese Prices aid Indian Producers to Raise Offers

Indian Ferro Chrome prices have been given a boost by the elevated Chinese purchase tender prices. Major Stainless steel mills released their HC Ferro Chrome tender price for May as RMB 5,700/ 50 basis per tonne (INR 60,900/MT), tax inclusive, delivered, up by RMB 250/ 50 basis per MT M-o-M. Meanwhile, the spot prices in China for HC Ferro Chrome also continued on an upward trajectory due to higher South African Chrome ore prices.

The demand in the domestic market remains almost absent and very scarce transactions have been reported at INR 62,000/MT Ex-Jajpur. Many Ferro Chrome smelters had halted operations during the lockdown, whereas, few smelters continued operations at significantly reduced capacity.

Participation in the recently concluded OMC Chrome ore auction was mainly focused on the higher grade ores (48% and above), with lower grades remaining unsold. The major reason for poor demand was the uncertainty in the Ferro Chrome market.

A Jajpur based producer shared with SteelMint, "Ferro Chrome demand is weak in the domestic as well as global markets, as Stainless steel remains subdued and it may take an ample amount of time for its prices to recover." Meanwhile, another manufacturer shared his views and said that the situation may not ease anytime soon, as the global economy has slowed down considerably severely impacting Stainless Steel demand, and further upsetting the Ferro Chrome market.

The prices for Indian Ferro Chrome assessed by Steelmint is as follows:
Ex-Jajpur: INR 62,000/MT
CNF China: cents 65/lb
CNF Japan: cents 68/lb
CNF South Korea: cents 67/lb

Outlook
Producers in the domestic market expect that the prices may remain stable in the coming week, although few sellers might be compelled to sell below the standard price to combat the cash flow issues. Market experts believe that until and unless stainless steel market revives there is very little hope for the Ferro Chrome market to sustain any positive price increments.