India: Ferro chrome prices at a 3-month high in recent auctions

• Higher bids achieved at OMC's chrome ore auction
  
  
• China's Tsingshan's ferro chrome tender prices unchanged for February
  
  

Indian high-carbon ferro chrome (HC60%, Si:4%) prices experienced a w-o-w surge of INR 5,200/tonne (t) ($63/t) due to a market shortage and elevated production costs post-OMC's chrome ore auction.

As of 24 January, BigMint's assessment revealed high-carbon ferro chrome (HC60%, Si:4%) prices at INR 117,900/t ($1,418/t) exw-Jajpur. Similarly, high-carbon low-silicon ferro chrome (HC 60%, Si: 2%) prices also climbed by INR 5,600/t ($67/t) w-o-w, reaching INR 126,100/t ($1,519/t) exw-Jajpur on 25 January.

Sources indicate emerging offers for ferro chrome (HC60%, Si:4%) at approximately INR 120,000-123,000/t exw Jajpur, though no confirmed deals have been reported at these escalated levels, as per a statement from a stainless steel mill to BigMint.

Key observations over the week

Higher bids at OMC's chrome ore auction: During OMC's chrome ore auction on 19 January , the entire stock of various grades, totalling 45,200 tonnes, was successfully booked. Notably, for high-grade material, the premium rose to a range of 30-38% above the base price. This uptick in production costs, attributed to the elevated prices of chrome ore, prompted producers to quote higher offers.

Active participation in Vedanta-FACOR's auction: At Vedanta-FACOR's ferro chrome auction yesterday, the bigger lot of 10-150 mm (Cr: 57.5% min) achieved an H1 price of INR 117,400/t exw, up 2% from the base price of INR 115,000/t. Meanwhile, the smaller lot of same grade and size was sold at INR 118,500/t exw. Tight supplies of ferro chrome and hike in bids in OMC's auction were the key reasons behind price hike.

Overview of China's market: Ferro chrome (HC60%) prices in China remained steady w-o-w at RMB 8,900/t ($1,259/t) exw-Inner Mongolia. Spot trading activities were also limited due to upcoming lunar holidays. Tsingshan, a major stainless steel company also kept its ferro chrome tender price steady m-o-m at RMB 8,495/t ($1,202/t).

Indian stainless steel prices remain stable: Prices for 304 grade stainless steel were INR 173,000/t ($2,081/t) exw-Mumbai and were stable w-o-w. There was still limited demand in this industry. However, as buyers procured material ahead of the holiday season, Chinese prices for stainless steel went up by around $5-7/t w-o-w.

Outlook

Market participants opine that ferro chrome prices are expected to firm up in the coming days. However, sustenance may be impacted by price acceptance from stainless steel players.