India: Ferro chrome prices fall on muted demand

Domestic ferro chrome prices decreased by around INR 6,000/t w-o-w amid dull demand in the spot market as buyers remained reluctant to book material at higher prices, thereby pressurising the producers to lower offers.

According to SteelMint's assessment on 31 March, ferro chrome prices are hovering around INR 120,000-123,000/t exw even as producers failed to conclude big deals this week.

Highlights

• Sluggish demand: Buyers were hesitant to book higher levels of ferro chrome this week which led to sluggish domestic demand. This led to a downtrend in domestic offers and ferro chrome prices decreased due to the lack in Chinese demand.
  
  
• Chrome ore prices firm: Imported chrome ore prices were firm this week but remained on the higher side due to high crude oil prices impacting the international chrome ore market. Stainless steel mills have started procuring material and although they have increased their purchase prices those are still at lower levels, as raw material costs remain quite high. So, mills are engaging in needs-based purchases resulting in a slight decline in actual transactions.
  
  
• Stainless steel sentiments high: The stainless steel market remained weak on higher prices due to high raw material costs. Despite this, prices remain high and the market sentiment is relatively positive, although buyers remain cautious. Moreover, ferro chrome prices also decreased as a result of weak demand.
  
  
• China's mills raise tender prices: Chinese stainless steel mills have increased ferro chrome purchase prices by RMB 500/t for April'22. Chrome ore prices are firm and the ferro chrome smelters might reduce production which could help push up prices.
  
  

Outlook
Indian ferro chrome producers are unwilling to reduce offers further amidst high price realisation from exports to Europe. Moreover, as stainless steel and stainless steel scrap prices rise there is bound to be higher demand for ferro chrome.