India: Ferro chrome prices edge up following recent deals, auction results

• Bids rise by INR 2,000/t ($24/t) exw at FACOR's auction
  
  
• Domestic market sees around 10,000 t spot trades
  
  

Indian high-carbon ferro chrome (HC60%, Si:4%) prices went up by INR 1,200/t ($14/t) w-o-w as compared to the previous assessment on 27 September. Prices went up as bids in Vedanta-FACOR's auction continued their uptrend and routine trades in the spot market were also seen.

Price trends

Domestic prices witness uptrend: Indian high-carbon ferro chrome (HC60%, Si:4%) prices stood at INR 111,300/t ($1,325/t) exw-Jajpur, as per BigMint's assessment on 4 October. Approximately 10,500 t of spot trades were concluded last week within the price range of INR 109,000-112,500/t ($1,298-1,340/t) exw.

High-carbon low-silicon and low-carbon ferro chrome (C:0.1%) prices too went up by INR 1,100/t ($13/t) and INR 1,850/t ($22/t) w-o-w to INR 116,800/t ($1,391/t) exw-Jajpur and INR 215,250/t ($2,563/t) exw-Durgapur, respectively.

Decline in export offers: Demand from China was low last week ahead of the National Day holidays. It was down by 1 cents/lb w-o-w to 93 cents/lb CNF-Tianjin.

For exports to Japan and South Korea, prices fell by 2 cents/lb w-o-w each to 97 cents/lb CNF Tokyo and 96 cents/lb CNF Busan.

Weekly market recap

FACOR's auction, trades driving the market: At the recent ferro chrome auction by Vedanta-FACOR on 30 September, the larger lot of 10-150 mm fetched an H1 price of INR 110,500/t ($1,316/t) exw. Bids too went up by INR 2,000/t ($24/t) as compared to the previous auction on 21 September. The results for this showed positive shift in the market.

Along with this, market was supported by spot trades with around 10,500 t of deals carried out in the previous week.

Limited availability, high chrome ore prices drive up production costs: OMC's September auction saw a reduced quantity of chrome ore offered, which was booked at a significant premium of 16.74-71.14% (INR 3,200-15,800/t) over the base price, thereby driving up production costs. Consequently, many producers have either shifted to manganese production or scaled down their output, providing strong support to ferro chrome prices.

Increase in Indian stainless steel prices: Stainless steel prices for 304 grade HRC increased by INR 1,000/t ($12/t) w-o-w to INR 183,000/t ($2,179/t) exw-Mumbai. It was majorly due to the 9% w-o-w hike in LME nickel prices. A major domestic stainless steel producer informed BigMint, "The demand for 200 and 400 series may pick up as utensils and machinery inquiries usually go up during the festive season."

Outlook

Taking into account current market conditions, prices are likely to stay in the current range with slight variations.