India: Ferro Chrome Prices Increase As The Market Faces Supply Shrinkage

Indian Ferro Chrome prices have increased amid reduced production. Most of the producers have had reduced their production levels due to the down-trending Ferro Chrome market. Moreover, a few producers have also shifted to Manganese alloys production due to a recent hike in the Silico Manganese prices. However, with such a shift, the quantity of Ferro Chrome that was coming into the market was reduced. Therefore, the pressure on the Ferro Chrome prices will be released for now.

Meanwhile, in China, few Ferro Chrome plants were shut down due to pollution restrictions, which created a shortage of production. Also, the prices of Chrome ore from South Africa increased, which provided support to the Chinese Ferro Chrome Prices. A senior official from FAMD Division, TATA Steel said, "with the recent increase in UG2 prices, the Chinese Stainless steel prices and low quantities with the traders, we expect a lot of liquidity in the market." "Such a scenario will strengthen the Ferro Chrome market in the near term and therefore we have decided to hold order bookings unless the Ferro Chrome market surges up higher with lucrative offers."

In the domestic market, producers are offering Ferro Chrome at INR 61,000/MT Ex-Jajpur. In the export market, the prices increased amid supply shortage. Offers for CNF South Korea (10-50 mm, HC 60%) is at around 65 cents/lb, CNF Japan (10-50 mm, HC 60%) is at 66cents/lb and for China, the prices are at around 62cents/lb CNF. Trading for South Korea and Japan remained absent amid ongoing holidays.

On the future outlook, the prices may increase for now. However, producers are anxious about the upcoming supply disturbance the Chrome alloys market is about to face.