India: Ferro chrome prices remain stable amid sustained need-based buying

• Indian stainless steel prices decline
  
  
• China's domestic offers remain steady
  
  

Indian high-carbon ferro chrome (HC60%, Si:4%) prices remained largely stable last week, going up by a slight INR 100/t ($1/t) w-o-w as compared to the previous assessment on 30 October. Prices were steady as only need-based procurement was being done in the market and offers also remained unchanged.

Price trends

Domestic: As per BigMint's assessment on 23 October, Indian high-carbon ferro chrome (HC60%, Si:4%) prices were at INR 110,000/t ($1,304/t) exw-Jajpur. Around 250 t of trades were reported to BigMint last week in the price range of INR 109,000-111,000/t ($1,292-1,316/t) exw.

A slight drop of INR 500/t ($6/t) w-o-w was observed in high-carbon low-silicon ferro chrome prices, at INR 116,000/t ($1,375/t) exw-Jajpur. The low-carbon (C:0.1%) material went up by INR 1,000/t ($12/t) w-o-w to INR 212,000/t ($2,513/t) exw-Durgapur.

Export: Export offers to Japan and South Korea were steady last week. For China, these were stable as well with a slight fluctuation of 0.5 cents/lb w-o-w at 90.5 cents/lb CNF Tianjin. However, export demand remained subdued due to the housing crisis in China. That apart, weak global demand impacted markets in Japan and South Korea.

Market summary

Cautious approach leading to need-based buying: Post-Diwali holidays, the market did not experience any major movement which kept prices largely stable. Additionally, procurement of the material was being done with caution. A seller informed BigMint, "Our cost of production is higher than the current market prices. We also have orders in hand and so are not in a hurry to sell."

China market scenario: Ferro chrome (HC60%) prices in China were unchanged w-o-w at RMB 8,100/t ($1,129/t) exw-Inner Mongolia. Sources informed that domestic ferro chrome production still remained in surplus but demand for stainless steel, especially the 200 grade, remained weak.

Decline in Indian stainless steel prices: Prices of the stainless steel 304 grade HRC fell by INR 2,000/t ($24/t) w-o-w to INR 180,000/t ($2,134/t) exw-Mumbai. Weak demand continued to surround this sector and, due to it, a leading India stainless steel coil producer reduced prices for this month. Prices of 316L and 304-grade HRCs were reduced by INR 2,000/t ($24/t), while CRCs in these grades saw a decrease of INR 3,000/t ($36/t).

Another key producer informed BigMint, "We are currently operating at 60% capacity as demand is not that good,"

Outlook

Stainless steel demand is likely to stay range-bound in the near term, which may keep ferro chrome prices subdued as well.