India: Ferro chrome prices continue to trend downward following key auction

• Bid prices edge down in FACOR's ferro chrome auction
  
  
• Marginal uptick seen in stainless steel prices
  
  

Indian high-carbon ferro chrome (HC60%, Si:4%) prices declined by INR 1,700/t ($20/t) w-o-w compared to the previous assessment on 24 July 2024. Prices dropped as demand remained subdued, which was reflected in Vedanta-FACOR's auction on 29 July where bid prices dropped.

Price trends

Domestic: As per BigMint's assessment on 31 July, Indian HC ferro chrome (HC60%, Si:4%) prices were INR 106,200/t ($1,269/t) exw-Jajpur. The previous week saw conclusion of around 4,400 t of deals within the price bracket of INR 105,500-109,000/t ($1,260-1,302/t) exw.

High-carbon low-silicon ferro chrome (HC60%, Si:2%) prices declined by INR 3,000/t ($36/t) w-o-w to INR 111,000/t ($1,326/t) exw-Jajpur. Approximately 450 t of deals were reported within a price range of INR 110,800-112,000/t ($1,323-1,338/t) exw.

Furthermore, low-carbon (C:0.1%) ferro chrome prices also dropped INR 5,200/t ($62/t) w-o-w to INR 219,000/t ($2,616/t) exw-Durgapur on 1 August.

Export: Export prices to China and South Korea both fell w-o-w to 96 cents/lb and 100 cents/lb, respectively, on CNF basis. Around 3,000 t of material was booked at 97 cents/lb last week to be exported to China for delivery in August.

Market this week

Drop in bids at FACOR's auction: After OMC's chrome ore auction, another key auction was held this week by Vedanta-FACOR which was concluded at INR 106,600/t ($1,273/t) exw, almost close to the base price. There was a drop of INR 1,500/t ($18/t) in comparison to the auction held on 15 July.

A major producer told BigMint, "Currently it is more about requirement and demand than prices. The stainless steel market is not in a good condition and may remain like this until September."

Fall in Chinese prices: Ferro chrome (HC60%) prices in China moved down by RMB 200/t ($28/t) w-o-w to RMB 8,800/t ($1,217/t) exw-Inner Mongolia. Prices were affected due to domestic overproduction and lower tender prices of major stainless steel mills.

Unchanged scenario in stainless steel sector: Stainless steel prices for 304 grade HRC witnessed a slight uptick of INR 1,000/t ($12/t) w-o-w to reach INR 177,000/t ($2,114/t) exw-Mumbai. This minor increase was primarily due to an upward revision in LME nickel prices along with the hike in coil prices by up to INR 3,000/t ($36/t) across grades effected by a leading manufacturer.

In the near term, prices are likely to stay within a narrow range as buying interest continues to remain subdued.

Outlook

In view of existing market conditions, BigMint estimates that ferro chrome prices may stay rangebound with slight variations in the days ahead. However, the market will remain under pressure and significant improvement can only be expected when both domestic and global stainless steel markets show signs of recovery. Until then, prices are likely to remain stable amid minor fluctuations.